CERCLA's Petroleum Exclusion: Whose Burden Is It Anyway?

Carol F. Barry

Ms. Barry is an environmental attorney in Washington, D.C. and an LL.M. student at George Washington University. In addition to her J.D., she has a B.S. in chemical engineering. The author wishes to thank Professors William A. Harvey, Laurent Hourcle, and Charles Allen Wright for their guidance on this Dialogue. Additionally, she thanks H. Mark Wright and Thomas A. Barnard for their comments on earlier drafts.

This Dialogue is a shortened version of the author's thesis for George Washington University. In her thesis, she covers the scope of the petroleum exclusion, the burden of proving the exclusion, and judicially created rebuttable presumptions. Her thesis also examines flaws in U.S. Environmental Protection Agency technical studies as they relate to judicially created rebuttable presumptions.

[26 ELR 10479]

Are you going to hang him anyhow—and try him afterward?¹

This is a common reaction after first observing the liability associated with the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund).² Most defendants can be strong-armed into settling based on scant circumstantial evidence and seemingly unlimited liability. To avoid this liability, defendants who dispose of petroleum try to benefit from the most significant exemption from CERCLA's definition of hazardous substance—the petroleum exclusion. The scope of the petroleum exclusion is still in a state of flux, but most courts that have considered the exclusion agree that it covers naturally occurring substances and chemicals added during the refining process.³

Several commentators have urged courts to place the burden of proving the exemption⁴ on the defendant, but in so doing, they failed to apply well-founded rules of construction, evidence, and procedure.⁵ The resolution of this issue of statutory construction is critical. Evidence in most Superfund cases is sparse, and neither the plaintiff nor the defendant may have access to the facts necessary to establish whether chemicals in released petroleum occurred naturally, were added during refining, were added later, or were released separately. Accordingly, allocation of the burden of proof may determine whether the exclusion applies to a particular case.

This Dialogue examines which party should bear this burden. It analyzes the text and legislative history of CERCLA, as well as case law on the burden of proving statutory exceptions generally and the petroleum exclusion in particular. It concludes that the plaintiff bears the burden of establishing that the petroleum exclusion does not apply.

Statutory Text

The plain language of the statute is the starting point for any statutory interpretation or construction,⁶ and an interpretation of CERCLA's liability scheme must examine the plain language of the statute's definition of "hazardous substance," a key term for assessing liability under CERCLA.⁷ (The petroleum exclusion is found in the definition of hazardous substance.)

The Act defines "hazardous substance" as:

(A) any substance designated pursuant to section 1321(b)(2)(A) of title 33, (B) any element, compound, mixture, solution, or substance designated pursuant to section 9602 of this title, (C) any hazardous waste having the characteristics identified under or listed pursuant to section 3001 of the Solid Waste Disposal Act [42 U.S.C. 6921] (but not including any waste the regulation of which under the Solid Waste Disposal Act [42 U.S.C. 6901 et seq.] has been suspended by Act of Congress), (D) any toxic pollutant listed under section 1317(a) of title 33, (E) any hazardous air pollutant listed under section 112 of the Clean Air Act [42 U.S.C. 7412], and (F) any imminently hazardous chemical substance or mixture with respect to which the Administrator has taken action pursuant to section 2606 of title 15. The term does not include petroleum, including crude oil or any fraction thereof which is not otherwise specifically listed or designated as a hazardous substance under subparagraphs (A) through (F) of this paragraph, and the term does not include natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel (or mixtures of natural gas and such synthetic gas).⁸

[26 ELR 10480]

Scope of the Petroleum Exclusion

Congress did not define the terms petroleum, crude oil, fraction, and natural gas. Instead, this task was left to the courts. The phrase "which is not otherwise specifically listed or designated as a hazardous substance" may initially suggest that hazardous substances that are indigenous to petroleum, such as arsenic, benzene, chromium, ethylbenzene, lead, toluene, and xylene, are outside the petroleum exclusion because they are also listed as hazardous substances in the environmental statutes incorporated by reference. The U.S. Court of Appeals for the Ninth Circuit, however, determined that if the literal meaning were applied, the petroleum exclusion would be rendered a nullity.⁹ The court held that the petroleum exclusion applies to chemicals that are indigenous to petroleum or added during the refining process even if those chemicals are listed as hazardous substances.¹⁰

The exclusion, however, does not apply to substances in higher concentrations than those normally found in petroleum,¹¹ and some courts have ruled that the petroleum exclusion does not cover used oil to which hazardous substances have been added.¹² The U.S. Environmental Protection Agency (EPA) defined the critical issue:

The question, therefore, is not whether used oil is "petroleum" and thus exempted from CERCLA jurisdiction, but to what extent substances found in used oil which are not found in crude oil or refined petroleum fractions are also "petroleum." If such substances are not "petroleum" then a release of used oil containing such substances may trigger CERCLA response actions, not to the release of used oil, but to the contaminants present in the oil.¹³

EPA recognizes that waste oil may be excluded from the term hazardous substance.¹⁴ Additionally, in Wilshire Westwood Associates v. Atlantic Richfield Corp.,¹⁵ the Ninth Circuit held that virgin leaded gasoline, which was released into the environment, was excluded from Superfund liability because of the petroleum exclusion.¹⁶

Rules of Evidence and Procedure on Burden of Proof

An often quoted principle of law is that the burden of proof for an element lies with the party to whose case the element is essential.¹⁷ In a sense, this rule begs the question. Any proposition can be restated to the advantage of one of the parties.¹⁸ Nevertheless, case law establishes that the structure of a statute determines the allocation of the production burden.¹⁹ If the exception is incorporated in the "enacting clause"²⁰ of the statute under which the plaintiff asserts a right, it is the plaintiff that must show that his or her case does not come within the scope of the exception.²¹

The rule, as the U.S. Supreme Court stated it in United States v. Vuitch,²² is that "when an exception is incorporated in the enacting clause of a statute, the burden is on the prosecution to plead and prove that the defendant is not within the exception." The petroleum exclusion is a classic "exception," not a proviso²³: it is located in the definition of hazardous substance, which is the cornerstone of CERCLA liability. Although Vuitch was a criminal case, the rule it states also applies in civil cases.²⁴

[26 ELR 10481]

In Seese v. Bethlehem Steel Co.,²⁵ a district court considered the burden of proving a statutory exception in the context of the Fair Labor Standards Act (FLSA). In Seese, employees of Bethlehem Steel Co. sought to recover lost wages and liquidated damages for work they performed on overtime in contravention of the FLSA, as amended by the Portal-to-Portal Act.²⁶ The Portal-to-Portal Act was enacted to make clear that portal-to-portal activities were not compensable unless made so by contract, custom, or practice. The issue before the Seese court was whether the plaintiffs had to prove that portal-to-portal activities fell within that exception or the defendant had to prove that the portal-to-portal activities were outside the exception's scope. The Seese court held that plaintiffs had the burden of proving that the overtime fell within the exception.²⁷ The Seese court quoted approvingly the following rule:

Whether a pleading must negative an alleged exception must be determined from the wording of the statute—"the true test is whether the exception is so incorporated with the substance of the clause defining the right, duty, liability, or offense as to constitute a material part of the description of the acts, omissions, or other ingredients thereof."²⁸

The petroleum exclusion is used in the material part of the description of the act in which CERCLA liability lies. Congress in effect placed the exclusion within CERCLA's "enacting clause"—the clause that describes a statutory offense.²⁹ In CERCLA, the enacting clause is found in § 107(a).³⁰ This enacting clause makes the release or threatened release of a hazardous substance a prerequisite to liability. Since a hazardous substance release is an integral part of this enacting clause, the clause incorporates the definition of hazardous substance, which in turn includes the petroleum exclusion. Because a CERCLA plaintiff must establish that he or she is within the class of persons the legislature intended to benefit when it granted the right to recover costs incurred in responding to a hazardous substance release, the plaintiff must prove that the substance at issue is not excluded from the definition of hazardous substance.

In Seese, the court stated that plaintiffs had the duty to plead in their complaint those activities that they believed were compensable. The portal-to-portal activities exception defines activities that are recognized as compensable. Similarly, CERCLA's definition of hazardous substances and the petroleum exclusion define which substances will cause CERCLA activities to be compensable.

In another case, Ansell v. City of Boston,³¹ the Massachusetts Supreme Judicial Court provided further support for the proposition that the plaintiff carries the burden of proving that the petroleum exclusion does not apply. Construing a statute that had an exclusion similarly situated to the petroleum exclusion,³² the court stated:

The rule as to the burden of proof, applicable both to criminal and civil cases, is that, where the duty or obligation or crime is defined by statute, if there be an exception in the enacting clause, or an exception incorporated into the general clause, descriptive of the duty or obligation or crime, then the party pleading must allege and prove that his adversary is not within the exception; but if the exception is in a subsequent, separate or distinct clause or statute, then the party relying on such exception must allege and prove it.³³

The statute at issue in Ansell authorized a person to recover from a city for property damages sustained on a public way due to a defect that the city might have remedied by exercising reasonable care, unless that person's "carriage" and the load thereon weighed more than six tons.³⁴ The plaintiff in Ansell, whose truck had been damaged on a city street, failed to prove that his truck fell outside the statutory exception. The court, therefore, affirmed a directed verdict in favor of the defendant, ruling that the defendant need not have proved the excessive weight of plaintiff's truck, but could instead rest on a general denial. The court correctly observed that plaintiffs—not defendants—are required under the statute to establish that they are within the class of plaintiffs to whom the legislature granted a right of recovery: "The statute creates and establishes a limited right of action and not an unrestricted liability. The plaintiff must bring himself within the terms of that limited right. The plaintiff cannot get on without showing that he comes within the class for whom alone liability was established."³⁵

Other courts have applied this same principle.³⁶ In Erbrich Products Co. v. Wills,³⁷ the defendant-manufacturing company, Erbrich, unintentionally released ammonia into the atmosphere, causing property damage and health problems. The plaintiff brought a tort action against Erbrich alleging that Erbrich's facility was a nuisance under Indiana's nuisance statute. Erbrich raised the statutory defense that the plaintiff had "come to the nuisance."³⁸ However, the "coming to the nuisance" statute contains an exclusion, in a separate subsection, for entities that operate their facilities in a negligent fashion.³⁹ The Indiana Court of Appeals quoted approvingly from Ansell and ruled that had the exclusion been contained in the same subsection as the defense, the party claiming coverage of the defense (in that case the defendant, Erbrich) would have the burden of proving that the exception did not apply. The court concluded that since the Indiana legislature had separated the [26 ELR 10482] exception into distinct subsections, Erbrich had no obligation to prove that the exception did not apply (i.e., Erbrich did not have to prove that it had not operated in a negligent fashion). The Erbrich court cited a well-known rule of evidence as additional support for its conclusion: "Generally, 'one who relies on an exception to a general rule or statute has the burden of proving that the case falls within the exception, unless the nonexistence of the exception is made a condition of the application of the rule.'"⁴⁰

Again, this rule is perfectly applicable to the petroleum exclusion. Under CERCLA, the nonexistence of the petroleum exclusion is a condition of liability relating to a release of a hazardous substance. Had Congress intended to create a proviso⁴¹ or an affirmative defense for petroleum, in which the defendant would bear the burden of establishing that his waste fell within the exclusion, Congress could easily have done so.⁴² Indeed, Congress did not even create a different subsection for the exclusion.

Case Law on the Burden of Proving the Petroleum Exclusion

The burden of proof issue for the petroleum exclusion has been addressed by district courts in Dana Corp. v. American Standard, Inc.,⁴³ Ekotek Site PRP Committee v. Self,⁴⁴ and Dartron Corp. v. Uniroyal Chemical Co.⁴⁵ With the exception of Judge Miller⁴⁶ in Dana, these courts failed to examine critically burden of proof issues that arise in Superfund cases.

In Dana, plaintiffs sued numerous parties who allegedly disposed of hazardous substances at a Superfund site that had accepted both municipal and industrial waste. Several of the defendants moved for summary judgment. Judge Miller placed the burden of proof on the plaintiffs to show that each defendant-generator's hazardous substance was disposed of at the site and that hazardous substances found at the site were similar to those found in the defendant's waste.⁴⁷ Judge Miller held that the plaintiffs were required to demonstrate that the petroleum exclusion did not apply to the defendant's waste oil.⁴⁸

Courts that have placed the burden of proof at the defendant's doorstep have failed to analyze the burden of proof issue carefully. To illustrate, in Ekotek, a Superfund case involving a waste oil reclaimer, the court relied heavily on a U.S. Supreme Court decision, United States v. First City National Bank,⁴⁹ that is inapplicable to the petroleum exclusion.⁵⁰

First City was an antitrust case that involved a statutory exemption dissimilar in significant ways to the petroleum exclusion. In that case, the United States sought to enjoin two bank mergers that the Comptroller of the Currency had approved.

The Bank Merger Act provided:

[the Comptroller] shall not approve … any … proposed merger transaction whose effect in any section of the country may be substantially to lessen competition, or to tend to create a monopoly, or which in any other manner would be in restraint of trade, unless [the Comptroller] finds that the anticompetitive effects of the proposed transaction are clearly outweighed in the public interest by the probable effect of the transaction meeting the convenience and needs of the community to be served.⁵¹

The issue before the First City Court was whether the defendant banks were required to show that the mergers fell within the exception. The First City Court held that the banks had the burden of proof for this exception. The Court's holding was supported by an unequivocal statement by the sponsor of the bill that became the Bank Merger Act that the burden lies with the defendant to invoke the exclusion.⁵² In contrast, CERCLA's legislative history is silent on this issue.

In addition, the petroleum exclusion is unlike the "convenience and needs" exception in First City. In First City, the Court wrote, "We think it plain that the banks carry the burden [of proving the 'convenience and needs' exception]. That is the general rule where one claims the benefits of an exception to the prohibition of a statute."⁵³ The petroleum exclusion, on the other hand, is not an exception to a statutory prohibition. Instead, it is like the "first sale" section of the copyright statute discussed in the American International Pictures, Inc. v. Foreman.⁵⁴

The first sale section was a limitation on, or definition of, the term "to vend" as used in § 1 of the Copyright Act of 1909. The court ruled that the nonoccurrence of a "first sale" is part of the second element of a plaintiff's infringement action (i.e., [26 ELR 10483] vending by the defendant) and that therefore the plaintiff must bear the burden of proof with respect to it.⁵⁵

Rather than setting forth statutory prohibitions, the section of CERCLA that incorporates the petroleum exclusion (via the definition of hazardous substance) and the relevant section of the copyright statute set forth a plaintiff's right to cost recovery. Both sections contain the elements of a plaintiff's cause of action.

The Dartron court also directly addressed the burden of proof issue.⁵⁶ Dartron Corporation filed an action against Uniroyal Chemical Company claiming that Uniroyal had contaminated, and then transferred, property to Dartron. Uniroyal filed a counterclaim against Dartron for CERCLA response costs. Dartron admitted that it had at least one used oil spill on the ground and had released solvent while cleaning equipment. In addition, "Dartron regularly handled scrap storage tanks that contained waste petroleum products and unidentified sludges and liquids, some of which may have spilled on the ground."⁵⁷ The court held that substances added to a petroleum product during use are not covered by the petroleum exclusion.⁵⁸ Furthermore, "the Environmental Protection Agency presumes to be hazardous[,] wastes from the interior of a tank that held a petroleum product."⁵⁹ The court noted that hazardous substances commonly found in used oil were actually contaminating Dartron's property.⁶⁰ Therefore, the court concluded, Dartron had the burden of showing that the used oil it spilled did not contain hazardous substances not normally inherent in petroleum.⁶¹

The court, however, misstated EPA's position on used oil. The Agency expressly decided not to list used oil as a hazardous waste.⁶² In addition, United States v. Western Processing Co.,⁶³ on which the Dartron court relied heavily in asserting that a presumption exists that wastes from a tank that stored petroleum are hazardous, is factually distinguishable from Dartron. Western Processing concerned a defendant who refused to provide information to the plaintiff concerning the composition of the tank in which oil was stored.⁶⁴ It is a long-standing principle that the burden of proof shifts to the party who has knowledge within his or her possession but refuses to provide the information to the opposing party.⁶⁵

The Dartron court also stated a policy reason for placing the burden of proof on Dartron. Essentially, the court reasoned that any party who dumped used oil onto the soil should not escape liability. According to the court, accepting Dartron's position would protect not only the negligent dumper, but also the party that willfully cast a blind eye to the possibility that the waste contained dangerous contaminants.⁶⁶ The court's policy argument, however, does not justify expanding CERCLA's scope beyond the limits intended by Congress.

There are several courts that have addressed other exemptions within the enacting clause of CERCLA and have held that the burden of proof lies with the defendant. Although United States v. Northeastern Pharmaceutical & Chemical Co.,⁶⁷ (NEPACCO) did not concern the burden of proof for the petroleum exclusion, NEPACCO did deal with the burden of proof for showing compliance with the national contingency plan (NCP). In NEPACCO, the U.S. Court of Appeals for the Eighth Circuit held that the burden of proving NCP compliance lies with a private-party plaintiff but not with a government plaintiff.⁶⁸ The court wrote:

The statutory language itself establishes an exception for costs that are inconsistent with the NCP, but appellants, as the parties claiming the benefit of the exception, have the burden of proving that certain costs are inconsistent with the NCP and, therefore, not recoverable. See United States v. First City National Bank, 386 U.S. 361, 366, 87 S. Ct. 1088, 1092, 18 L. Ed. 2d 151 (1967).⁶⁹

The court, however, did not stop there. It proceeded to explain its holding based on the difference between the language of CERCLA § 107(a)(4)(A), which sets forth an element of a government plaintiff's case, and the language of § 107(a)(4)(B), which sets forth the NCP element of a private party's case. Section 107(a)(4)(A) provides that a person meeting the elements of § 107(a)(1), (2), (3), or (4) is liable for "all costs of removal or remedial action incurred by the United States Government or a State or an Indian tribe not inconsistent with the national contingency plan."⁷⁰ Section 107(a)(4)(B), however, provides that such person is liable for "any other necessary costs of response incurred by any other person consistent with the national contingency plan."⁷¹ The court noted that "the statutory scheme thus differentiates between governmental and nongovernmental entities in allocating the burden of proof of whether response costs are consistent with the NCP."⁷²

The language of the petroleum exclusion does not differentiate between government and nongovernment plaintiffs. The burden of proving that exception is the same no matter who the plaintiff is. In considering the NCP issue, the NEPACCO court noted that the reasonableness of government costs (i.e., costs incurred by EPA) is presumed.⁷³ It was EPA, after all, that prepared the NCP. With respect to the petroleum exclusion, however, agency expertise is not a factor. Therefore, because there is no agency expertise at issue in the context of the petroleum exclusion and there is no distinction between government and nongovernment [26 ELR 10484] plaintiffs in the exclusion's language, there is no special reason for relieving a plaintiff—even a government plaintiff—of the burden of proving that exclusion.

In United States v. Fleet Factors Corp.,⁷⁴ the U.S. Court of Appeals for the Eleventh Circuit ruled that the burden of proving the secured creditor exemption⁷⁵ lies with the defendant.⁷⁶ In reaching this conclusion, the court relied on a line of cases that place the burden on a defendant to prove that it may rely on an exception to a statutory prohibition. The court cited a district court opinion—United States v. Maryland Bank & Trust Co.⁷⁷—and First City. The district court in Maryland Bank & Trust held that a party relying on "a statutory exemption to a Congressionally imposed rule of general liability" has the burden of proving its entitlement to that exemption.⁷⁸ But that court relied on First City and the U.S. Supreme Court's decision in Federal Trade Commission v. Morton Salt Co.⁷⁹—cases that do not stand for the broad propositions for which the Maryland Bank & Trust court cited them. They are limited to exceptions to statutory prohibitions.⁸⁰ And CERCLA § 107 creates a general liability scheme, not a system of statutory prohibitions.

If one, however, accepts the Fleet Factors decision as a legitimate result of the line of cases on which it relies, one is faced with a conundrum. Two lines of cases exist on assigning the burden of proving a statutory exception: one line, which extends as far back as 1697,⁸¹ places this burden on the plaintiff; the other, an increasingly attenuated line of cases of which Fleet Factors is an example, places this burden on the defendant. The U.S. Supreme Court has said, "It is not uncommon to find 'apparent tension' between different canons of statutory construction. As Professor Llewellyn famously illustrated, many of the traditional canons have equal opposites."⁸² But which line of cases should one rely on in deciding who bears the burden of proof with respect to the petroleum exclusion?

Legislative History

Although CERCLA's legislative history is scant, significant statements and actions in Congress help answer this question. Congress considered enacting a bill that would have covered releases of petroleum.⁸³ In fact, this bill was broad enough to include releases of virgin petroleum, yet it was apparent to key members of Congress that to pass CERCLA, significant changes had to be made.⁸⁴ In an amendment,⁸⁵ Congress abandoned all efforts to require remediation of environmental damage caused by oil pollution.⁸⁶ Could Congress have passed a statute that required the defendant to prove that the petroleum exclusion applies? It seems extremely unlikely.⁸⁷ A telling comment made by Sen. Walter Huddleston (D-Ky.) suggests that by rejecting the legislation proposed to respond to oil, Congress was finally able to enact legislation that responded to most hazardous substances with the exception of petroleum.⁸⁸ In addition, then-Rep. Barbara Mikulski (D-Md.) expressed her disappointment that the legislation would be unable to address oil spills.⁸⁹ These statements reveal the pressure legislators felt to enact some form of legislation. Congress considered but finally rejected CERCLA legislation that was responsive to a petroleum release.

Given this strong showing of congressional intent not to bring petroleum into the CERCLA liability scheme and given the fact that the outcome of cases involving the petroleum exclusion often turns on who has the burden of proof, it is unlikely that Congress intended burden-of-proof rules to deny petroleum producers the benefit of the exclusion. Congress could have placed in the statute a rebuttable presumption that substances otherwise satisfying the definition of hazardous substance are not petroleum. (Rebuttable presumptions in other parts of CERCLA were considered.)⁹⁰ But Congress did not do so.⁹¹

[26 ELR 10485]

Conclusion

Although the environmentally expedient answer may be to place the burden of proving the petroleum exclusion on defendants, in effect this would cause defendants to be considered guilty of polluting the environment until they can prove that they are innocent. Courts should apply longstanding rules of statutory construction, evidence, and procedure. They should also consider the legislative history of CERCLA. In doing so, they will find that the burden of proof lies with the plaintiff.

1. FRED R. SHAPIRO, AMERICAN LEGAL QUOTATIONS 263 (1993) (quoting Mark Twain).

2. 42 U.S.C. §§ 9601-9675, ELR STAT. CERCLA §§ 101-405.

3. See, e.g., Wilshire Westwood Assocs. v. Atlantic Richfield Corp., 881 F.2d 801, 804, 19 ELR 21313, 21314-15 (9th Cir. 1989).

4. To prevail in a Superfund case, a plaintiff must prove each element of liability by a preponderance of the evidence. "Burden of proof" has been used to refer to both the burden of persuasion and the burden of production. The burden of persuasion generally remains with the plaintiff throughout the trial unless the burden is shifted by statute. 9 JOHN HENRY WIGMORE, WIGMORE ON EVIDENCE § 2488, at 284 (1940 & Supp. 1991). This burden requires the party to persuade the trier of fact that a particular fact is true. Id. § 2485, at 285. When the case is in equipoise, the party carrying the burden of persuasion loses. Id. § 2487, at 279; CHARLES TILFORD MCCORMICK, MCCORMICK ON EVIDENCE § 337, at 570 (4th ed. 1992). In comparison, the burden of production can shift during the trial. WIGMORE, supra, § 2489, at 301. Failure to produce sufficient evidence causes that party to lose on that fact. Id. A presumption may be used to shift the burden of production. Id. § 2491, at 304.

5. R. Aguiluz, Refining CERCLA's Petroleum Exclusion, 7 TUL. ENVTL. L.J. 41 (1993); Christopher D. Knopf, What's Included in the Exclusion: Understanding Superfund's Petroleum Exclusion, 5 FORDHAM ENVTL. L.J. 3 (1993); L. Bacher Jr., When Oil Is Not Oil: An Analysis of CERCLA's Petroleum Exclusion in the Context of a Mixed Oil Spill, 45 BAYLOR L. REV. 233, 239 (1993).

6. American Tobacco Co. v. Patterson, 456 U.S. 63, 68 (1982). Because the focus of this Dialogue is the burden of proof of the exclusion, the scope of the exclusion is examined only briefly.

7. 42 U.S.C. § 9601(14), ELR STAT. CERCLA § 101(14).

8. Id. (emphasis added).

9. Wilshire Westwood Assocs. v. Atlantic Richfield Corp., 881 F.2d 801, 804, 805, 19 ELR 21313, 21315 (9th Cir. 1989). This case involved a leaking underground storage tank that contained virgin leaded gasoline. Virgin gasoline is unused gasoline.

10. Id.

11. United States v. Alcan Aluminum Corp., 755 F. Supp. 531, 539, 21 ELR 20767, 20770 (N.D.N.Y. 1991), aff'd in part, rev'd in part on other grounds, 990 F.2d 711, 23 ELR 20706 (2d Cir. 1993); City of New York v. Exxon Corp., 766 F. Supp. 177, 188, 22 ELR 20145, 20149 (S.D.N.Y. 1991). The argument that the defendant in Alcan did not make was that if the concentration of hazardous substances in the used oil was less than the concentration of hazardous substances found in crude from which the virgin oil was refined, the petroleum exclusion should be applied to the used oil.

12. Alcan, 755 F. Supp. at 539, 21 ELR at 20770; see also 50 Fed. Reg. 13456, 13460 (Apr. 4, 1985) (in which EPA stated, "EPA does not consider materials such as waste oil to which CERCLA hazardous substances have been added to be within the petroleum exclusion"); S. REP. NO. 848, 96th Cong., 2d Sess. 29-30 (1980) ("The reported bill does not cover spills or other releases strictly of oil.").

13. EPA Memorandum Regarding the Scope of the CERCLA Petroleum Exclusion, from Francis Blake, General Counsel, EPA, to J. Winston Porter, Assistant Administrator for Solid Waste and Emergency Response, EPA 2 (July 31, 1987) (available from the ELR Document Service, ELR Order No. AD-556) [hereinafter 1987 EPA Memorandum].

14. EPA stated:

Other petroleum wastes, including waste oil, are not specifically listed in the [Resource Conservation and Recovery Act (RCRA)] regulations, but they may exhibit the characteristics of hazardous waste and therefore be subject to full RCRA regulation. However, because these wastes are excluded from the definition of "hazardous substance" by the specific language of Superfund, regardless of their RCRA status, they are not hazardous substances for purposes of the notification requirement of Section 103(c).

46 Fed. Reg. 22144, 22145 (Apr. 15, 1981). "No petroleum substance including used oil can be a 'hazardous substance' except to the extent it is listed as a hazardous waste…." 1987 EPA Memorandum, supra note 13, at 2.

15. 881 F.2d 801, 19 ELR 21313 (9th Cir. 1989).

16. Id. at 804, 810, 19 ELR at 21315, 21318. (Virgin oil is refined petroleum that is unused.) The Ninth Circuit has also held that crude oil tank bottoms are not petroleum. Cose v. Getty Oil Co., 4 F.3d 700, 705, 708, 23 ELR 21335, 21337, 21339 (9th Cir. 1993).

17. 9 WIGMORE, supra note 4, § 2486, at 274-75.

18. Id. at 275

19. See Burden of Allegation and Proof in Civil Cases as Regards Exception in Statute, 130 A.L.R. 440, 440-86 (1941); Edward W. Cleary, Presuming and Pleading: An Essay on Juristic Immaturity, 12 STAN. L. REV. 5, 8 (1959).

20. United States v. Cook, 84 U.S. (17 Wall.) 168, 176 (1872) ("Commentators and judges have sometimes been led into error by supposing that the words 'enacting clause,' as frequently employed, mean the section of the statute defining the offence, as contradistinguished from a subsequent section in the same statute, which is a misapprehension of the term, as the only real question in the case is whether the exception is so incorporated with the substance of the clause defining the offence as to constitute a material part of the description of the acts, omission, or other ingredients which constitute the offence"); see also infra notes 29-31 and accompanying text.

21. In re Lawson's Estate, 287 N.Y.S. 9, 11 (N.Y. Sur. Ct. Kings County 1936); In re Sitkin, 271 N.Y.S. 688, 699 (N.Y. Sur. Ct. Kings County 1934) ("[A] person claiming to come within the class benefitted [by a statute] must demonstrate 'every fact required to enable the court to judge' that he is the sort of person in whose favor the pre-existing law has been altered.").

22. 402 U.S. 62, 70 (1971).

23. See infra note 42.

24. See Burden of Allegation and Proof in Civil Cases as Regards Exception in Statute, 130 A.L.R. 440, 440-86 (1941); 31A C.J.S. Evidence § 104, at 173 (1964); American Int'l Pictures, Inc. v. Foreman, 400 F. Supp. 928 (S.D. Ala. 1975).

25. 74 F. Supp. 412 (D. Md. 1947), aff'd sub nom. Seese v. Bethlehem Steel Co. Shipbuilding Div., 168 F.2d 58 (4th Cir. 1948).

26. 29 U.S.C. §§ 201-219, 255, 260, 630, 633a, 634.

27. Seese, 74 F. Supp. at 416.

28. Id. at 415 (citing 49 C.J. 154 (1930)).

29. If an exclusion is within an enacting clause, or is otherwise a restriction on or a definition of a provision within the enacting clause, the plaintiff bears the burden of establishing that the exclusion does not apply. See Burden of Allegation and Proof in Civil Cases as Regards Exception in Statute, 130 A.L.R. 440, 440-86 (1941); 31A C.J.S. Evidence § 104 (1964); Cleary, supra note 19, at 5, 8.

30. 42 U.S.C. § 9607(a), ELR STAT. CERCLA § 107(a).

31. 150 N.E. 167 (Mass. 1926).

32. Id. at 168.

33. Id. at 169 (emphasis added).

34. Id. at 168.

35. Id. at 169 (emphasis added).

36. See Erbrich Prods. Co. v. Wills, 509 N.E.2d 850, 858 (Ind. Ct. App. 1987). For an extensive list of cases, see Burden of Allegation and Proof in Civil Cases as Regards Exception in Statute, 130 A.L.R. 440, 440-86 (1941).

37. 509 N.E.2d 850 (Ind. Ct. App. 1987).

38. The Indiana legislature has codified this doctrine. See IND. CODE § 34-1-52-4(f) (West 1982 & Supp. 1995).

39. Id. § 34-1-52-4(g) ("Thissection [the 'coming to the nuisance' defense section] does not apply whenever a nuisance results from the negligent operation of an … industrial operation or its appurtenances.").

40. Erbrich Prods. Co., 509 N.E.2d at 858 (quoting from 31A C.J.S. Evidence § 104, at 173 (1964)).

41. See supra note 23 and accompanying text.

42. While many courts use the terms interchangeably, an important distinction exists between an "exception" and a "proviso." "An exception takes out of the statute something that otherwise would be part of the subject-matter of it…." Rowell v. Janvrin, 45 N.E. 398, 400 (1896). A proviso conditionally defeats the operation of the statute. Id.

43. 866 F. Supp. 1481, 25 ELR 21051 (N.D. Ind. 1994).

44. 881 F. Supp. 1516, 25 ELR 21331 (D. Utah 1995).

45. 917 F. Supp. 1173, 26 ELR 21056 (N.D. Ohio 1996).

46. Judge Miller, a recognized evidentiary expert, has authored an Indiana treatise on evidence. See Robert Lowell Miller Jr., Indiana Evidence, 12, 13 INDIANA PRACTICE §§ 101-1008 (perm. ed. 1984 & Supp. 1994).

47. Dana Corp., 866 F. Supp. at 1489, 25 ELR at 21054.

48. Id. at 1508, 25 ELR at 21063 ("The plaintiffs have presented no evidence that the oil was contaminated with a waste oil such that it would not fall within the CERCLA petroleum exclusion."). Judge Miller further held that the plaintiffs failed to produce any evidence supporting an inference that the defendants added hazardous substances to their waste other than those excluded from CERCLA. Id., 25 ELR at 21064. In addition, Judge Miller held that a laboratory analysis of a defendant's waste oil was irrelevant because the analysis was of waste oil generated after the defendant could have possibly shipped the oil to the site. Id. at 1508-09, 25 ELR at 21064. The process generating the oil had changed and the plaintiffs' burden was to show that the defendants' waste at the time of disposal contained hazardous substances. Id. Furthermore, the plaintiffs' expert opined that used oil filters likely contained "wear metals." He did not state that all used oil filters contain wear metals or that a specific defendant's used oil filters contained wear metals. Id. at 1526, 25 ELR at 21074. Nor did he specify the types of wear metals sent to the site by the defendant. Id.

49. 386 U.S. 361, 366 (1967).

50. Ekotek, 881 F. Supp. at 1524, 25 ELR at 21335.

51. 12 U.S.C. § 1828(c)(5)(B) (emphasis added).

52. Rep. Wright Patman (D-Tex.), the sponsor of the bill, said, "It should be clearly noted that the burden of establishing such 'convenience and needs' is on the banks seeking to merge; and when we say clearly outweighed we mean outweighed by the preponderance of the evidence." 112 CONG. REC. 2441 (1966); see First City, 386 U.S. at 366.

53. 386 U.S. at 366 (emphasis added).

54. 400 F. Supp. 928 (S.D. Ala. 1975).

55. Id. at 933.

56. Dartron, 917 F. Supp. at 1173, 1184, 26 ELR at 21056, 21061.

57. Id. at 1183, 26 ELR at 21060.

58. Id., 26 ELR at 21060-61 (citing Niecko v. Emro Mktg. Co., 769 F. Supp. 973, 981-82, 22 ELR 20503, 20507 (E.D. Mich. 1991), aff'd, 973 F.2d 1296, 23 ELR 20183 (6th Cir. 1992)).

59. Id.

60. Id. at 1184, 26 ELR at 21061.

61. Id.

62. See 57 Fed. Reg. 21524, 21528, 21531 (May 20, 1992); 57 Fed. Reg. 41566, 41604 (Sept. 10, 1992).

63. 761 F. Supp. 713, 720-22, 21 ELR 20976, 20979-80 (W.D. Wash. 1991).

64. Id. at 720, 21 ELR at 20979.

65. MCCORMICK, supra note 4, § 337, at 570.

66. Dartron, 917 F. Supp. at 1173, 1184, 26 ELR at 21056, 21061.

67. 810 F.2d 726, 17 ELR 20603 (8th Cir. 1986).

68. Id. at 747, 17 ELR at 20613.

69. Id. The NEPACCO court's analysis is flawed because the court misapplied First City, which limits this "general rule" to exceptions to a statutory prohibition.

70. 42 U.S.C. § 9607, ELR STATE. CERCLA § 107(a)(4)(A).

71. Id. § 9607(a)(4)(B), ELR STAT. CERCLA § 107(a)(4)(B).

72. NEPACCO, 810 F.2d at 747, 17 ELR at 20614.

73. Id. at 748, 17 ELR at 20614.

74. 901 F.2d 1550, 20 ELR 20832 (11th Cir. 1990).

75. See 42 U.S.C. § 9601(20)(A), ELR STAT. CERCLA § 101(20)(A) ("Such term ['owner or operator'] does not include a person, who, without participating in the management of a vessel or facility, holds indicia of ownership primarily to protect his security interest in the vessel or facility.").

76. Fleet Factors, 901 F.2d at 1555-56, 20 ELR at 20834.

77. 632 F. Supp. 573, 16 ELR 20557 (D. Md. 1986).

78. Id. at 578, 16 ELR at 20559.

79. 334 U.S. 37 (1948). The Maryland Bank & Trust court also relied on a 1961 district court decision in a securities case. 632 F. Supp. at 578-79, 16 ELR at 20559.

80. United States v. First City Nat'l Bank, 386 U.S. 361, 366 (1967); Morton Salt Co., 334 U.S. at 44-45.

81. See Jones v. Axen, 91 Eng. Rep. 976 (1697).

82. Landgraf v. USI Film Prods., 128 L. Ed. 2d 229, 251 (1994).

83. H.R. 85, 96th Cong., 1st. Sess. (1979).

84. 126 CONG. REC. 31964 (1980) (statement of Rep. Florio); id. at 31968 (statement of Rep. Florio); id. at 31970 (statement of Rep. Breaux); id. at 31971 (statement of Rep. Studds); id. at 31972 (statement of Rep. Vento).

85. Amendment 2623, 96th Cong., 2d Sess. (1980).

86. Three bills were introduced in the 96th Congress—H.R. 85, H.R. 7020, and S. 1480, H.R. 85, 96th Cong., 1st Sess. (1979); H.R. 7020, 96th Cong., 2d Sess. (1980); S. 1480, 96th Cong., 1st Sess. (1979). All three bills contributed to some extent to CERCLA. H.R. 85, primarily concerned with the damage caused by oil pollution to land or water immediately adjacent to navigable waters or tributary waters, was rejected.

87. Before the final vote on the bill that was finally enacted, Rep. Marion Gene Snyder (R-Ky.) said, "I have received phone calls from Members of the Senate saying that the Senate will be unable to accept any amendment, especially one adding oil to the Superfund package." 126 CONG. REC. 31975 (1980).

88. Id. at 30945.

89. Id. at 31976.

90. A determination of natural resource damages in accordance with the regulations will have the effect of a rebuttable presumption. Id. at 30924; id. at 31958; id. at 18585; id. at 26059-60; id. at 26059-60 (Letter to Sen. Howard W. Cannon from James L. Kimble, American Insurance Association, asserting that the rebuttable presumption for damages to natural resource claims will make it impossible to defend claims); id. at 18585; S. REP. NO. 848, 96th Cong., 2d Sess. 86 (1980) (rebuttable presumption that allows a human disease to be presumed to be caused by the toxic pollutant that is released into the environment).

91. A search of the Congressional Record reveals that the issue of a rebuttable presumption with respect to the petroleum exclusion was not discussed. One commentator has suggested that a rebuttable presumption should exist to shift the burden to the defendant to show that hazardous substances have been added to the petroleum. Knopf, supra note 5, at 3, 5, 33-41. When determining whether to create a rebuttable presumption, however, courts generally examine three fundamental factors: policy, fairness, and probability. Cleary, supra note 19, at 21; 9 WIGMORE, supra note 4, at 346, 347 n.16 (citing comment of Law Revision Commission); see also Basic Inc. v. Levinson, 485 U.S. 224 (1988). Policy considerations have already been discussed. See supra notes 83-90 and accompanying text. Fairness does not favor the plaintiff, because the plaintiff can obtain through discovery any relevant records a generator might have. And as for probability, one cannot assume that hazardous substances have been added to the petroleum. Thus, given Congress' failure to create such a presumption, courts should be reluctant to create one of their own.