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21 ELR 20549 | Environmental Law Reporter | copyright © 1990 | All rights reserved Hassayampa Steering Committee v. Arizona (II)No. CIV 89-0188 PHX RCB (D. Ariz. October 30, 1990)In the second of two decisions in a Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) response action involving the Hassayampa landfill near Phoenix, Arizona, the court holds that the state is liable under CERCLA as a generator but not as an operator of the Hassayampa site. The record reveals that although Maricopa County, Arizona, owned the actual site, the State of Arizona participated in a variety of management activities. After addressing numerous motions to strike language from affidavits, the court turns to the parties' motions for summary judgment as to the state's liability as a generator. The court first holds that plaintiffs presented sufficient evidence of the state's CERCLA generator liability for the court to grant summary judgment. The state disposed of dichlorodimethyl silane and containers that formerly held parathion, guthion, lannate, and ambush. Plaintiffs showed that dichlorodimethyl silane has ignitable characteristics under the Resource Conservation and Recovery Act; that the chemical is a "DOT flammable liquid"; that paration and guthion are listed hazardous substances; that lunnate contains a listed hazardous substance; and that the pesticide containers disposed at Hassayampa, although listed as empty, were not properly cleaned to qualify as empty. The state failed to rebut this evidence. Turning to the state's CERCLA operator liability, the court holds that, for purposes of summary judgment, it is unable to unequivocally determine whether Arizona was an operator of Hassayampa within the meaning of CERCLA. The court finds that Arizona's participation at Hassayampa was significant. It conceptualized the use of Hassayampa for hazardous waste disposal, requested that Maricopa County agree to open Hassayampa and allow-dumping, co-developed the pit design to be used at Hassayampa, and received regular reports and conducted periodic on-site inspections. Through the use of the manifests at Hassayampa, the state controlled the actual disposal of the wastes. It determined the types of wastes to be disposed of in each of the particular pits, and had the ability to discover and abate any harm. Finally, the state derived a limited benefit from the opening of the site, since it averted a problem of alternative disposal sites after the closing of the other Phoenix landfills. However, the court also finds that, although the state's participation was persuasive, many of the activities undertaken were regulatory in nature. The county absolutely controlled several important management activities, including designing and constructing the pit scheme, supervision of the facility, hiring and managing employees, and ultimate closure of the facility. Because plaintiffs have not presented sufficient evidence that the state controlled enough management activities for the state to be an operator under CERCLA, summary judgment is inappropriate. The question of whether Arizona is more appropriately considered the regulator or the operator of the Hassayampa landfill is best left to a trial on the merits. Finally, the court holds that the state has presented adequate evidence that it did not share profits and losses with Maricopa County from operation of the site sufficient to establish a joint venture between the state and county. Rather, the state's conduct fell within its general authority and was valid. Counsel located at 21 ELR 20547. Broomfield, J: Plaintiffs move for partial summary judgment on defendant State of Arizona's ("State") liability for contribution under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"). 42 U.S.C. §§ 9601-9657. The State responded and cross-moved for summary judgment. After careful consideration of the parties oral and written arguments, including the various motions to strike, the Court now rules. The Hassayampa landfill is located on a 77-acre parcel west of Phoenix, Arizona. Between April 20, 1979 and October 28, 1980, allegedly several million gallons of liquid hazardous substances and several thousand tons of additional industrial wastes were disposed of in the northeast portion of the landfill. Eventually, Hassayampa was declared a Superfund site pursuant to Section 105(8) of CERCLA. 42 U.S.C. § 9605(8). In 1979, following the closure of landfills in Phoenix, several transporters began to pressure the State to provide an alternative site. Arizona Department of Health Services ("ADHS") personnel considered several other landfill sites. Although ADHS was aware of a 1977 Report, entitled " Hydrogeologic Conditions and Waste Disposal at the Hassayampa, Casa Grande and Somerton Landfills, Arizona," which concluded that Hassayampa was not satisfactory for hazardous waste disposal, it selected Hassayampa. The State met with some resistance by Maricopa County ("County"). Finally, after the February 1979, ADHS Cease and Desist Order, prohibiting disposal of hazardous waste at all Phoenix landfills, the County acceded to the State's request and allowed disposal of the wastes at Hassayampa for thirty days. In exchange, the State apparently agreed to hold the County harmless for such disposal. Although, Maricopa County owned the actual site, the State participated in a variety of management activities. On April 20, 1979, in an ADHS memorandum, the State designated Hassayampa as the only waste disposal site in the County. The State apparently suggested the design of the four disposal pits at the site and segregated wastes for each. The State developed and supervised a manifest system for identifying and segregating the wastes. Generators and transporters were required to fill out the manifests for each load of waste. State approval was then required before the generator could dispose of the waste at Hassayampa. Manifests were only used at Hassayampa, but State approval was required for disposal. Non-toxic waste could be disposed of at the City of Phoenix's 27th Avenue facility; industrial wastes were transported to Hassayampa; and extremely hazardous wastes could be directed to approved out-of-state sites. Hassayampa personnel would not accept a load without a manifest that included the appropriate ADHS approval. Furthermore, ADHS and the County agreed to determine the costs of the operation and to generate sufficient financial support. ADHS personnelconducted periodic inspections and received regular reports. The County received all gate fees for disposal. ADHS did not station any personnel on-site. After the original thirty day period had passed, the State asked for and received several extensions to continue hazardous waste disposal at Hassayampa. The State and County agreed to their various roles and division of responsibilities in a series of letters between ADHS and County officials. On October 28, 1980, the State's final extension expired and Hassayampa was closed to hazardous waste disposal. Although the State did not have any formal set of regulations governing hazardous waste disposal, beginning in 1978, ADHS began developing regulations for the storage, treatment and disposal of hazardous waste. These regulations were based upon the Environmental Protection Agency's proposed set of regulations, codified as the Resource Conservation and Recovery Act of 1976. 42 U.S.C. §§ 6901-6987. Finally, on October 23, 1980, the State adopted a comprehensive code regulating hazardous wastes. To maintain a claim under CERCLA § 107(a), a plaintiff must allege (1) that the disposal site is a facility under CERCLA; (2) that a release or threatened release of a hazardous substance has occurred; (3) that the release or threatened release has caused plaintiff to incue response costs consistent with the national contingency plan; and (4) that defendant falls within one of the four groups of "persons" subject to CERCLA liability. Ascon Properties, Inc. v. Mobil Oil Co., 866 F.2d 1149, 1152 [19 ELR 20374] (9th Cir. 1989); 42 U.S.C. § 9607(a). The main issue is whether the State falls within one of the categories of responsible persons, pursuant to 42 U.S.C. § 9607(a)(1)-(4). Plaintiffs argue that the State is liable under three theories. First, they claim that the State is liable as a generator who disposed of hazardous substances at Hassayampa. 42 U.S.C. § 9607(a)(3). Furthermore, they assert that the State is allegedly liable as an operator of the facility, under a control theory and a joint venturer theory. 42 U.S.C. § 9607(a)(1)-(2). A. Motions to Strike1 Mr. T. Williams is currently the Director of ADHS, and between August 1976 and December 1980, he was a Deputy Director. Plaintiffs move to strike portions of paragraph four, which discusses the State's and County's concern over the closure of the 19th Avenue landfill. Exhibit A, State's Cross-Motion. The information is immaterial to the instant motions and therefore plaintiff's motion to strike portions of paragraph four is denied as it is irrelevant. Plaintiffs also move to strike of paragraph eight, which states: I am certain that ADHS never agreed to operate the Hassayampa Landfill or to share operational or financial responsibility with Maricopa County. ADHS was not authorized to either own or operate a landfill and, moreover, ADHS could not agree to obligate the State of Arizona for any liability associated with the landfill. Plaintiffs argue that Mr. T. Williams cannot from a legal conclusion, concerning ADHS's agreements and authorization. The State responds that the information is offered simply to show Mr. T. Williams' understanding. Mr. Williams' understanding is irrelevant; the information is, obviously, included for its alleged truth. Mr. T. Williams is not competent to draw legal conclusions and, therefore, plaintiffs' motion is granted as to paragraph eight. Finally, plaintiffs oppose paragraph nine, discussing two letters, attached to his affidavit as Exhibits D and E. Plaintiffs argue that the letters are the "best evidence," and the Court has considered the attached letters. Plaintiffs also claim that the letter attached as Exhibit D, from Dr. George Rowland of the County, to Suzanne Dandoy, Director of ADHS, requesting, inter alia, that the State assume operational responsibility for Hassayampa, lacks foundation as he has no personal knowledge of its creation. Mr. T. Williams responded to the letter. However, the Court finds the letter's comment concerning "operational responsibility" to be irrelevant and unpersuasive. It does not appear that the discussion concerned the legal definition, pursuant to CERCLA, of a facility operator. The motion is granted as to paragraph nine. Mr. Canez joined the Solid Waste Unit of ADHS in December, 1976 and in mid-1979, he became the manager of the Hazardous Waste Unit within ADHS. Exhibit B, State's Cross-Motion. Plaintiffs complain that paragraphs five and twelve, discussing State orders concerning hazardous waste disposal, are hearsay and not the best evidence. Plaintiffs objections are without merit as they include the same information within their statement of facts. Plaintiffs object to portions of paragraphs six, seven, nine, and twenty-two, discussing the County's concerns about employee safety and potential liability. Plaintiffs argue that Mr. Canez, as a state employee, can only speculate as to County employees' thoughts. Again, the Court is confused over why plaintiffs bother to object, as they include the same information within their substantive arguments. Plaintiffs next argue that paragraphs seventeen and eighteen contain information about on-site activities, of which Mr. Canez has no personal knowledge. First, plaintiffs' contentions regarding splashguards and linings for the pits is immaterial, as the information is [21 ELR 20551] irrelevant to the instant motions. Second, plaintiffs' complaint about the gate fees information is moot, as they recite the fact within their motion. Plaintiffs next move to strike the portions of paragraphs six, seven, twenty and twenty-two, which purportedly discuss concerns and attitudes of the County. For the most part, these paragraphs discuss Mr. Canez's actions and, to that extent are without merit. Other information was included in various parts of plaintiffs' papers and, therefore, their contentions are irrelevant. The portions that discuss the County's concern and activities are inappropriate, as Mr. Canez has no knowledge about the County and can only speculate. Plaintiffs object to paragraph eleven, where Mr. Canez states that at an April 1979 meeting, ADHS told the County that it was unable to accept financial responsibility for Hassayampa. Although left unsaid, it appears that Mr. Canez was at the meeting. However, his recollection of ADHS's position is hearsay. For the purposes of the instant motion, although his recollection is hearsay, the Court will consider that the State did not accept financial responsibility for Hassayampa. Plaintiffs also object to portions of paragraphs fourteen, fifteen, sixteen, eighteen and twenty-four. Plaintiffs claim that Mr. Canez attempts to recite the position of ADHS, but is not authorized. Mr. Canez has been employed by the State for seventeen years and was obviously very involved with activities leading up to the present controversy. Therefore, he appears to be quite knowledgeable about ADHS's positions, and plaintiffs may impeach his statements. However, Mr. Canez cannot speak for the County and recite their positions. Therefore, the Court will strike those portions pertaining to Mr. Canez's recitation of County positions. Finally, Plaintiffs move to strike portions of paragraphs fourteen, fifteen and twenty, which seek to draw legal conclusions. Plaintiffs' motion in this respect is denied, as the Court is aware that Mr. Canez cannot draw legal conclusions. His statements are simply his understanding and are therefore irrelevant to the instant controversy. b. Second Affidavit2 Plaintiffs object to paragraph seven, which purports to describe the chemical characteristics of dichlorodimethyl silane, in order to cast doubt on the hazardous characteristic of the chemical. Exhibit B, State's Reply/Supplemental Statement of Facts ("SSOF"). Plaintiffs maintain that the State has not laid the proper foundation to qualify Mr. Canez to render these scientific opinions and that many of his scientific conclusions are based on speculation. The State counters that Mr. Canez has an undergraduate degree in Chemistry, years of experience in dealing with hazardous waste and reviewed a chemical manual. The Court will consider Mr. Canez's affidavit, but finds that Mr. Canez's conclusory determination is not sufficient to create a genuine issue of material fact. See infra, at 17-19. Mr. B. Williams was an employee of the Solid Waste Unit, until ADHS formed the Hazardous Waste Unit in mid-1079, and he moved to that Unit. Exhibit C, State's Cross-Motion. Plaintiffs' contentions with regard to paragraph ten are without merit, as they cite the same information about the 1979 Memorandum to transporters and generators. Plaintiffs next object to portions of paragraphs four, six and sixteen, claiming that Mr. B. Williams has no knowledge of County employees' opinions. Although this is true, this motion is unnecessary. The portions are not offensive and plaintiffs discuss similar information. Plaintiffs object o paragraph nine, reciting that Mr. Canez suggested the pit scheme and the County employees agreed with the idea to segregate the wastes, but that the County constructed the pits. This issue is thoroughly discussed in the following section, concerning Mr. B. Williams' second affidavit, where he attempts to clarify his earlier statements. See infra, at 11-16. Plaintiffs next argue that paragraphs seven, twelve, thirteen, fourteen and fifteen contain statements about ADHS's authority, understanding and activities. Although Mr. B. Williams may be able to testify as to some of ADHS's activities at Hassayampa, he is not competent concerning the scope of ADHS's authority or responsibility. Therefore, the Court will strike the offending portions and disregard them in the following discussion. Finally, plaintiffs complain about paragraphs five, seven, twelve, thirteen and fourteen, which discuss the County's operator status and ADHS's responsibilities at Hassayampa. Again, Mr. B. Williams' information is competent about ADHS's activities at Hassayampa, but lacks foundation concerning the County's status and ADHS's authority. The offending portions will also be stricken and disregarded. Plaintiffs move to strike Mr. B. Williams' second affidavit in its entirety and, alternatively, paragraph eight. Exhibit A, State's Reply/SSOF. Plaintiffs argue that the second affidavit attempts to create a genuine issue of material fact by contradicting his prior deposition testimony and recasting Mr. Canez's prior affidavit and testimony. In the second affidavit, Mr. B. Williams states that to his knowledge: (1) "no State employee was involved in the design or construction of the pits,"(P5); (2) "ADHS employees did not make recommendations to the County or discuss with County employees the size, shape, depth or compaction of the pits," (P6); (3) although an ADHS employee may have "suggested to the County that the 'basic pit' be placed so as to maximize its proximity to the 'acids pit' and the 'pesticides pit,' . . . the County did not locate the pits in this manner," (P7). The State counters that these statements merely clarify and explain his testimony, which he felt plaintiffs had misconstrued. Therefore, the State argues, because the affidavit does not conflict with his testimony, it must be considered by the Court. See. e.g., Harkins Amusement Ent. v. General Cinema Corp., 850 F.2d 477, 482-83 (9th Cir. 1988); cf. Radobenko v. Automated Equip. Corp., 520 F.2d 540, 544 (9th Cir. 1975) (A party cannot raise an issue of fact by submitting an affidavit contradicting prior deposition testimony). The Court finds that the second affidavit, although not completely contradictory, is self-serving. Mr. B. Williams does not do a complete about-face, but he does attempt to recharacterize his prior testimony and Mr. Canez's statements. Furthermore, Mr. B. Williams had an opportunity to review and correct the transcript of his testimony, but made no changes. Mr. B. Williams' deposition testimony included the following exchange: Q. [By Mr. Muchmore And were you concerned at all, sir, about the substances from the pit migrating laterally and coming in contact with one another? A. We knew that that was a possibility, I believe. Q. Was any precaution taken to prevent that? A. As far as I know, there wasn't. Q. Were you concerned, sir, that the unlined pits might permit the hazardous waste to pollute the groundwater? A. We were aware that there was a possibility that could have happened. . . And while there were no structures built or anything like that, as I recall the situation, we wanted to make sure that the basic pit was near the acids pits and was near the pesticides pit. That was an active thought on our part to put that pit adjacent to and separating the other two pits. Not necessarily to separate the acid from the pesticide, but just to try to put them in relationship with the pesticide, lime or basic pit, and acid pit. Q. Okay. So you were separating the pesticides from the acid with the pit containing the alkaline materials, probably the lime sludge? A. Physically that's what happened, but we were not — we were maximizing the access of the basic pit to the other two pits. We were not separating the two pits from each other for any reason. We were trying to make sure that if there was any leakage from the basic pit to the other two pits, that the acid pit would have a potential for intermingling with anything underground that came from the basic pit . . . We were not separating the acid and pesticide pit for any reason. [21 ELR 20552] B. Williams' Deposition, pp. 290-91, Exhibit 6, Plaintiffs' Supplemental Statement of Facts ("PSSOF") (emphasis added). Furthermore, Mr. B. Williams' deposition testimony is confirmed by Mr. Canez's testimony and affidavit. Exhibit B, State's Cross-Motion. Mr. Canez states: During these meeting [between State and County officials concerning the use of Hassayampa], I also suggested that Maricopa County use separate disposal pits in order to segregate certain types of industrial wastes that would be incompatible and, possibly, threaten employees safety. Maricopa County concurred with this suggestion and, within several days of the mid-April meeting, Bill Williams and I met with several Maricopa County employees at the landfill and were shown the general areas within which the County intended to construct disposal pits. To my knowledge, no ADHS employee advised Maricopa County on the manner in which the disposal pits should be constructed and were not present during their construction, which took place in late April. In his deposition, Mr. Canez explained: Q. [By Mr. McCann] . . . Do you recall agreeing on the location of four pits at your meeting with Mr. Crohurst and Mr. Garcia [County employees] at Hassayampa? A. All depends on what you mean "location." My recollection is that Bill [Williams] and I got there, we met Mannie and Harry, and they took us to the area where they proposed to put these pits. But it wasn't like saying: This is going to be number one, there's going to be number two and number three. . . . Q. The suggestion that there be four separate pits was your idea, right? Q. In paragraph 10 of your affidavit, Exhibit 43, you state that you suggested that Maricopa County use separate disposal pits in order to segregate certain types of industrial wastes. So it was in fact your suggestion to use the separate pits, right. A. Right, considering the types of wastes that we had knowledge about. Q. What did you discuss with Mr. Crohurst and Mr. Garcia at this meeting on April 18th, 1979 at Hassayampa? A. Well, we principally were invited because the County, I guess, decided that they wanted to use an area of the landfill, and they wanted us to, you know, give our opinion as to whether — what we though about the area. We were concerned basically about not commingling it with solid waste and having an area that could be segregated, let's say, away from the rest of the municipal activity, the municipal solid waste disposal activity. So they took us to I think it was the northwest corner of the landfill and showed us the area where they were going to, you know, excavate the pits, and we discussed a little bit about the system, you know, what the manifest — how it was going to work. Q. You said that the County asked for your opinion on the area for this disposal operation. What opinion did you give them? A. Well, we thought, you know, it was fine, I guess. We didn't have a problem. We would have told them: We don't like this area. Go to another portion of the landfill. But what they wanted to do seemed okay with us. We didn't have really any concerns. Mr. Canez's Deposition, pp. 135-38, Exhibit 3, PSSOF (emphasis added). ADHS personnel suggested a system of separate pits for disposal of hazardous wastes at Hassayampa for purposes of waste compatibility and for protection of public health and safety. The State further admits that ADHS personnel recommended certain pits for disposal of certain classes of hazardous substances. Plaintiffs' First Requests for Admissions and Responses, No. 26, Exhibit 1, Plaintiffs' Motion for Summary Judgment. For purposes of summary judgment, the Court will consider Mr. B. Williams' second affidavit. However, its credibility, in light of his prior deposition testimony, Mr. Canez's testimony and the State's admission, is somewhat in doubt. Although the second affidavit is not entirely contradictory, it appears to be more than a simple clarification. Clearly, State employees suggested the pit scheme and, in conjunction with County employees, developed a general design. State employees were concerned with the layout of the dump and the potential for various wastes to commingle. Finally, plaintiffs object to paragraph eight, which discusses whether there was one pit for basic, alkaline wastes and whether the County later dug additional pits. The Court does not find any of this information objectionable, as it is irrelevant. Furthermore, in their reply, plaintiffs concede that Mr. B. Williams' beliefs contained in paragraph eight are based upon his personal knowledge. Reply to the Motion to Strike Supplemental Affidavits, at 5. 4. Affidavit of Charles Anders Mr. Anders was the Assistant Director for Environmental Health Services at ADHS between July 1983 and March 1987. The purpose of Mr. Anders' affidavit is to contradict several letters he wrote, which stated that ADHS should "assume primary responsibility" for the environmental problems at Hassayampa. Plaintiffs argue that Mr. Anders cannot speak for ADHS's position concerning the State's responsibility. Although this is true, plaintiffs offer the letters as evidence of ADHS's agreement with the County. Furthermore, defendant is critical of Mr. Anders' letters, as he was not employed by the State during the period in controversy and the letters were written several years later. Therefore, it appears that the Court can either strike the offending portions of the affidavit and the letters, or allow them to cancel each other out. Either way, the Court will disregard Mr. Anders' statements regarding ADHS's primary responsibility. 5. April 16, 1990 Scott Affidavit Plaintiffs object to the last sentence of paragraph five and paragraph nine, in it entirety, as they are not based on personal knowledge. The last sentence of paragraph five is irrelevant. Paragraph nine, however, states that it was Mr. Scott's understanding that ADHS employees did not participate in the construction of the pits. As Mr. Scott was the Director of the Division of Environmental Health Services, it would appear that he would have personal knowledge of the activities of ADHS employees. Furthermore, this fact supports the Court's earlier findings that the County actually constructed the pits. Finally, plaintiffs object to the last sentence of paragraph three, which claims that Mr. Scott did not cause ADHS to jointly operate Hassayampa. Plaintiffs are correct in their argument that Mr. Scott cannot draw legal conclusions. The State counters that Mr. Scott is only commenting on the scope of his authority. Therefore, the Court will disregard Mr. Scott's statement to the extent that it attempts to make a legal conclusion. B. Motions for Summary Judgment3 1. Generator Liability4 Plaintiffs argue that the State disposed of the following hazardous substances: dihydrazine sulfate, dichlorodimethyl silane, and containers that had previously held six different pesticides, including parathion, guthion, lannate and ambush. The State admits to disposing of these substances, but argues that they are not hazardous under CERCLA. Plaintiffs fail to provide any authority that dihydrazine sulfate, referred to in second manifest of Exhibit 7 to Plaintiffs' Motion for Summary Judgment, is a hazardous substance under any CERCLA provisions. In fact, neither party ever mentions the substance again. Therefore, plaintiffs will not be granted summary judgment on the basis that the State disposed of dihydrazine sulfate. On the other hand, dichlorodimethyl silane meets RCRA's ignitability characteristic, 40 C.F.R. § 261.21 (substance meets ignitability characteristic if its flash point is less than 140 degrees Fahrenheit). Plaintiffs provide support that dichlorodimethyl silane is [21 ELR 20553] a "DOT flammable liquid," and that the Department of Transportation regulations define "flammable liquid" as having a flash point below 100 degrees Fahrenheit. See Exhibit 9, Plaintiffs' Motion for Summary Judgment, and 49 C.F.R. § 173.115. Furthermore, they include a portion of a scientific text, which lists the chemical's flash point at 15.8 degrees Fahrenheit. Exhibit 23, PSSOF. The State apparently argues that the waste was listed as a solid, and that the regulation only applies to liquids. Defendant fails to provide any support or authority and the regulation clearly states that it applies to solid wastes that are liquids. 40 C.F.R. § 261.21(a)91). Plaintiffs last manifest refers to pesticide containers that formerly held parathion, guthion, lannate, ambush, azodrin and folex. Exhibit 7, Plaintiffs' Motion for Summary Judgment. Defendant argues that the containers were listed as empty and, therefore, it did not dispose of any hazardous substances. Again, defendant fails to provide any support and as plaintiffs explain a container is only empty if certain procedures are used for cleaning. See, e.g., 40 C.F.R. § 261.7(b)(3). Plaintiffs present sufficient evidence that the State did not properly clean the containers and that they, therefore, cannot be considered "empty." Furthermore, parathion and guthion are listed hazardous substances. 40 C.F.R. § 302.4; lannate contains a listed hazardous substance, methomyl. See Exhibit 8, Plaintiffs' Motion for Summary Judgment; 40 C.F.R. § 302.4.5 Finally, ambush has a flash point of 121 degrees Fahrenheit and, therefore, meets the characteristic of ignitability. 40 C.F.R. § 261.21. Ambush also contains xylene, a listed hazardous substance. 40 C.F.R. § 302.4. Exhibit 24, PSSOF. Plaintiff has presented sufficient evidence, for the purpose of summary judgment, that the State is liable as a generator for disposing of dichlorodimethyl silane and containers that formerly held parathion, guthion, lannate and ambush. The State has not rebutted that evidence. See Anderson, 477 U.S. at 250, 106 S. Ct. at 2510, 91 L. Ed. 2d at . Plaintiffs contend that the State is liable as an "operator" of Hassayampa, under 42 U.S.C. § 9607(a)(2). The definition provided in CERCLA is inefficacious: "any person . . . operating such facility." 42 U.S.C. § 9601(20)(A). The parties, however, agree that the statutes, legislative history and cases, taken as a whole, interpret an "operator" as one who exercises control over the activities that caused or contributed to a release of hazardous substances at the facility. The extent of the control necessary to charge a defendant with liability is the crux of the issue. The State participated in a variety of activities concerning waste disposal at Hassayampa. In the April 20, 1979 ADHS Memorandum, the State designated Hassayampa for hazardous waste disposal. State employees conceptualized the pit system at Hassayampa, because of their concern about commingling wastes. The State developed and supervised a manifest system for identifying and segregating the wastes. Transporters and/or generators filled out a manifest, specifically describing the wastes and submitted the form to ADHS. State approval was necessary before a transporter could dispose of the waste at Hassayampa. The State approved approximately 1300 manifests during the period in controversy. Although ADHS personnel were not stationed at the site, the conducted on-site inspections and received regular reports. Finally, the State sought from the County, several extensions to continue using Hassayampa until its closure in October 1980. Defendant urges the Court to deny liability based upon the State's lack of involvement in the day-to-day operations. The State characterizes their activities as "regulatory in nature." It asserts that because the State only aided in regulation and carried out its statutory duties, it cannot be considered an operator. Plaintiffs, on the other hand, argue that the State exercised direct control over a variety of operational aspects at Hassayampa. The parties discuss several analogous cases at length. Although they are not binding upon the Court, each provides an insightful analysis. Plaintiffs' reply/response relies heavily upon United States v. Stringfellow, No. 83-2501 JMI [20 ELR 20656] (C.D. Cal. Jan. 10, 1990) ("Jan. 10, 1990 Order"). The January 10, 1990 Order, which is unpublished, overruled the State of California's objections to the Special Master's Order on directed verdict. The Special Master found, and the Court upheld, that the State was an operator under CERCLA. The Court looked at eleven specific factors in analyzing the degree of control the State exercised over waste disposal at the site. Furthermore, the Court found that the "control need not be day-to-day, but rather depends on various factors weighed as a whole." Id. at 12. The specific factors were: expertise and knowledge of dangers of hazardous waste, conception of [the] idea of the site, design of he site, supervision, inspection, receipt of reports of the site, hiring or approving hiring of employees, determining operational responsibilities, control of disposal, ability to discover and abate harm, public declarations of responsibility, participation in opening and closing of site, and benefitting from the existence of the site. Id. Although the State was held to be an operator, defendant agrues that the case analysis actually supports its position. The State of Arizona argues that, unlike the facts in the instant controversy, the State of California directly participated in the day-to-day operation of the facility. The State informed Mr. Stringfellow, the owner of the site, that it would design the site, show him how to construct and operate it and would supervise the operation. United States v. Stringfellow, No. 83-2501 JMI, at 8, "Order Re Post-Fact Finding Hearing Motions for Judgment Notwithstanding the Verdict and Motions for New Trial" (C.D. Cal. Jan. 19, 1990) ("Jan. 19, 1990 Order). The State decided the location of a barrier dam and developed plans to build it. Id. at 9-10. The State instructed Mr. Stringfellow on how to build disposal ponds. Id. at 10. "State representatives did not act reasonably prudent in regard to investigating, choosing and designing the site." Id. The State regularly visited the site, hiring employees and making operational decisions. The State received reports and controlled dumping at the site. The State continued to allow and supervise dumping after Mr. Stringfellow closed the site and removed himself from the picture. Additionally, the State both opened and closed the site. The State's witnesses at the hearing admitted that the State controlled the site at least from May 1976 and onwards. In 1979, the State, not Stringfellow, gave permission as to who could enter the property and what could be dumped there. Jan. 10, 1990 Order, at 13. After stating that the State's activities met each of the eleven factors, the Court concluded that it was in fact an "operator" of the facility for CERCLA purposes. The State, on the other hand, points to the analysis in United States v. New Castle County, 727 F. Supp. 854 [20 ELR 20499] (D. Del. 1989). The State of Delaware was held not to be an operator of the site. The State there argued that their activities constituted mere regulation of the site and not control. Id. at 857. The State's activities included "site selection, planning, design, operations and determining the types of wastes suitable for disposal at the Site." Id. at 862. The State required a formal permit approval process, before a site was allowed to accept the wastes. Id. The State required testing of hydrogeological characteristics and undertook an independent review of the reports. Id. at 863 n.19. Furthermore, the State oversaw the determination of the types of wastes that were permitted to be disposed and certain wastes were only allowed pursuant to State approval. Id. Analyzing these facts, the Court found that the State's activities were insufficient to extend operator liability. In fact, the Court's analysis turned upon the issue of who profited from the disposal of the hazardous waste. Id. at 864. The legislative history and cases indicate that it is relevant in determining liability to consider whether the "person" charged with CERCLA liability profited in a commercial sense, as opposed to a general societal health sense. [21 ELR 20554] Id. at 865. Furthermore, the Court limited the "activity/contacts" analysis to the actual acts of control, and not the ability to control, by the State. Id. at 866. The State participated at Tybouts Corner [site] in its regulatory capacity as protector of the health, safety and welfare of its citizens. It did not participate or have the ability to control the Site with any proprietary or financial interests at stake. The State did not have any commercial interest at stake in the Site. Id. at 866-67. Therefore, "[c]onsidering the totality of circumstances, this Court finds they do not mandate the imposition of operator status under CERCLA." Id. at 869. New Castle provides another set of factors for a court to consider: The Court should inquire, inter alia, into whether the person sought to be strapped with operator status controlled the finances of the facility; managed the employees of the facility; managed the daily business operations of the facility; was responsible for the maintenance of environmental control at the facility; and conferred or received any commercial or economic benefit from the facility, other than the payment or receipt of taxes. The recitation of these factors is not intended to be exclusive, but only part of a para materia inquiry in determining operator status. Finally, defendant argues that United States v. Carolawn Co., Inc., 698 F. Supp. 616 (D.S.C. 1987) aff'd sub nom. United States v. Dart Industries, Inc., 847 F.2d 144 [18 ELR 21084] (4th Cir. 1988) is persuasive. the District Court found that the state agency was not an operator of the site and, therefore, was not a responsible party. The Court considered a variety of activities by the State in the disposal of wastes. The State agency approved of as subsidiary company to operate the facility and allowed for disposal of wastes. Id. at 618. The agency agreed, but eventually failed, to construct three monitoring wells at the site and to periodically sample them for contamination. Id. Subsequently, the company operating the site sold it and the new company, with the State's knowledge, solicited wastes without a permit. Id. The State agency reviewed information provided by generators about the wastes and granted or denied approval for disposal. Id. Furthermore, the agency had a waste tracking manifest system. Id. Finally, "in spite of its knowledge that the site was in deplorable condition and should be cleaned up and its knowledge of serious violations of state law, DHEC [the State agency] continued to authorize new customers to send wastes to the site.' Id. at 619. The Court found that those activities were not enough to impose operator status, as the agency was carrying out its "own statutory mandate." Id. The Fourth Circuit Court of Appeals affirmed, holding that the State was not an operator of the site. Dart Industries, 847 F.2d at 144. Plaintiffs recently filed a notice of supplemental authority, citing a recent decision of the District Court of the Eastern District of Pennsylvania, FMC Corp. v. United States, No. 90-1761 [20 ELR 21403] (E.D. Pa. July 18, 1990) (1990 WL 10294). The Court stated that the issue was "at what point does involvement or control become so pervasive or significant as to warrant the imposition of CERCLA liability" and denied defendant's motion to dismiss because it was "unable to conclude with certainty that FMC [was] not entitled to CERCLA relief against the government under any set of facts which could be proved.' Id., WL at 4. The Court rejected the government's distinction between regulation and management decisions for purposes of liability. Id. at 4-5. In interpreting CERCLA, the Court cited with approval, New Castle, 727 F. Supp. 854, and Dart, 847 F.2d 144, stating: There is no question that under CERCLA any person or entity that owns or operates a facility that produces hazardous substances is liable if they make the management decisions that create the waste. The Court finds that for the purposes of summary judgment it is unable to unequivocally determine that the State was or was not an "operator" of Hassayampa, within the meaning of CERCLA. Although the factors and analysis discussed in each of the above cases are helpful, each case should be decided by a close and thorough analysis of the particular facts. A totality of the circumstances approach is appropriate. See New Castle, 727 F. Supp. at 869. The Court declines to find that the existence or absence of a profit or financial loss is the dispositive factor. Cf. id. at 865. Furthermore, nothing in the state, or anything discussed by the parties, limits a finding of one operator per site. Both parties have presented strong arguments and persuasive evidence. In applying the relevant factors, discussed in New Castle, 727 F. Supp. at 862 and 869, and Stringfellow, No. 83-2501, Jan. 10, 1990 Order, at 12, the Court finds that the State's participation at Hassayampa was significant. The State possessed expertise and knowledge concerning the dangers of hazardous wastes. It was the State who conceptualized the use of Hassayampa for hazardous waste disposal. The State requested that the County agree to open Hassayampa and allow the dumping. The State, in conjunction with the County, developed the pit design. The State and the County opened the site for hazardous waste disposal in April 1979, but the County closed it in October 1980, after the State received several extensions. The State received regular reports and conducted periodic on-site inspections. Through the use of the manifests, the State controlled the actual disposal of the wastes. It determined the types of wastes to be disposed of in each of the particular pits and presumably required some testing for purposes of manifest accuracy. The State had the ability to discover and abate any harm, and fearing groundwater contamination, the State tested several wells. Finally, the State derived a limited benefit from the opening of the site; it averted a problem from transporters concerning alternative disposal sites after closing the Phoenix landfills. Although the State's participation was pervasive, the Court finds that many of those activities were regulatory in nature. Furthermore, plaintiffs have not presented sufficient evidence that the State controlled enough management activities for the Court to determine, on summary judgment, that the State was an operator, under CERCLA. The County absolutely controlled several important management activities. County employees designed the four pit scheme and then constructed them. County personnel supervised the facility. All on-site employees were hired and managed by the County. After the State's final extension expired, the County actually closed the site. Finally, the County derived a considerable financial benefit from the site. The County collected all gate fees and apparently controlled the finances of Hassayampa. There is no dispute that the State regulated activities at Hassayampa. Furthermore, the Court finds that it actively participated in a variety of the management activities of the site. However, the Court cannot determine, at this point in the proceeding from the record before it, that the State's official role was more than that of a regulator. The Court finds that this central question is best left to a trial on the merits and may be dependent on a host of other factors, not the least of which may be the credibility and veracity of State and County witnesses. Therefore, the Court will deny both motions for summary judgment. The parties both move for summary judgment on the joint venture issue. Plaintiffs contend that the State and County formed a joint venture to operate Hassayampa. Although the Ninth Circuit Court of Appeals has not decided whether a joint venture analysis is appropriate, two other courts have adopted the approach. See Edward Hines Lumber Co. v. Vulcan Materials Co., 861 F.2d 155, 157-58 [19 ELR 20187] (7th Cir. 1988); United States v. South Carolina Recycling & Disposal, Inc., 653 F. Supp. 984, 1004-05 [14 ELR 20272] (D.S.C. 1984), aff'd in part, vacated in part on other grounds sub nom. United States v. Monsanto Co., 858 F.2d 160, 24 166 n.7 [19 ELR 20085] (4th Cir. 1988), cert. denied, U.S. , 109 S. 25 Ct. 3156, 104 L. Ed. 2d 1019 (1989). Arizona law requires five elements for a joint venture: (1) an agreement; (2) common purpose; (3) community of interest; (4) equal right of control; and (5) participation in profits and losses. Tanner Cos. v. Superior Court, 144 Ariz. 141, 143, 696 P.2d 693, 695 (1985). At dispute here are the fourth and fifth elements. The Court has sufficiently discussed each parties' role in controlling the disposal activities at the site. Although both parties may have divided responsibilities. [21 ELR 20555] their separate activities do not negate the existence of an equal right to control. See Ellington v. Sloan, 22 Ariz. App. 383, , 527 P.2d 1100, 1103-04 (1974) ("The test is whether there is a right to mutual control over the subject matter of the venture. . . .") Plaintiffs argue that the State agreed to share the profits and losses with the County. Plaintiffs make a unique argument that the State profited by protecting public health and averting a "crisis" as a result of the Phoenix landfills closing and the State shared in the losses by administering the manifest system. Furthermore, plaintiffs produce letters from Mr. T. Williams to Dr. George Rowland, Director of the Public health Division of the County Health Department. The letters, dated in 1979, outline their agreement concerning Hassayampa and explain: "ADHS and the Maricopa County Health Department will determine the costs of the industrial waste disposal operation at the Hassayampa site and seek to generate sufficient financial support." Exhibit 11, Plaintiffs' Motion for Summary Judgment. Apparently, the State's agreement to generate financial support included a promise to support the County's application to the Legislature for funding. The County received all gate fees for waste disposal. Although the parties fail to fully explain, the County may have incurred any financial losses by virtue of their ownership of the site. Sharing of profits and losses should not be limited to monetary terms. See Ellington, 22 Ariz. App. at , 527 P.2d at 1103. However, the State's activities in this regard cannot be considered sharing of profits and losses. Clearly, it was the County who bore the largest financial burden or benefit. The State may have expended funds in their participation of the control the site, but plaintiffs have failed to present sufficient evidence of a true sharing of profits and losses for the Court to find a joint venture between the State and the County. Finally, the State argues that it is unable to form a joint venture, as a matter of law, because Arizona law prohibits the State from incurring obligations which have not been authorized by an appropriation. See Ariz. Rev. Stat. Ann. § 35-154. The Legislature did not appropriate funds to ADHS for waste disposal at Hassayampa. Apparently, the State also argues that an intergovernmental agreement was necessary. See Ariz. Rev. Stat. Ann §§ 11-951-954. Plaintiffs counter that ADHS had the specific authority to "[m]ake contracts and incure obligations within the general scope of its activities and operations subject to the availability of funds." Ariz. Rev. Stat. Ann § 36-104(7). Furthermore, the agreement with the County was within the general scope of ADH's statutory duty to protect the public health. The Court agrees that the State's conduct fell within its general authority and, therefore, was valid. Finally, plaintiffs argue that the intergovernmental agreement statute is inapplicable, becaue the State and County were exercising separate, but complementary powers. The Court declines to address this issue. First, the Court has found no evidence of shared profits and losses to justify finding a joint venture and therefore, this discussion is unnecessary. Second, as evidenced by the dearth of argument and citations, this issue has not been authoritatively decided in Arizona. The State has presented sufficient evidence for the Court to conclude that the State and the County did not share profits and, therefore, were not co-ventures. The State's motion for summary judgment on the joint venture area is granted. Defendant argues that plaintiffs have failed to establish a prima facia case under § 107(a) of CERCLA, because they have failed to produce any evidence that they have incurred a type of response costs that is recoverable and consistent with the National Contingency Plan. See 42 U.S.C. § 9607(a)(4)(B). Plaintiffs contend that the complaint alleges that plaintiffs have incurred and will continue to incur response costs in connection with the Remedial Investigation/Feasibility Study as prescribed by the EPA Administrative Consent Order. They correctly contend that these response costs are recoverable under CERCLA, see Ascon Properties, 866 F.2d at 1154, and that their complaint is sufficient under Fed. R. Civ. P. 8(a). Furthermore, defendant provides no support for its contention that more specificity is required or that the types of response costs are not cognizable. The Court finds that the State is liable as a generator for disposing of dichlorodimethyl silane and containers that formerly held parathion, guthion, lannate and ambush. However, the Court is unable to determine for the purposes of summary judgment that the State operated Hassayampa, pursuant to CERCLA. The State's activities, although pervasive, were mostly regulatory in nature. The importance and extent of the State's other mangement-type activities is uncertain to the Court at this stage of the proceedings. Finally, the State has presented sufficient evidence that the State and County did not share profits and losses and, thereby, establish a joint venture. IT IS ORDERED granting in part and denying in part as set forth in this memorandum plaintiffs' motions to strike (Doc. ## 506 and 546). IT IS FURTHER ORDERED granting in part and denying in part as set forth in this memorandum plaintiffs' and defendant State's motions for summary judgment (Doc. ## 293 and 374). 1. Although the State's Response attacks the credibility of the various affidavits submitted by plaintiffs, they fall to actually strike the offending portions. Therefore, the Court only considered plaintiffs' motions. 2. Plaintiffs filed a separate motion to strike various supplemental affidavits included with the State's Reply and Supplemental Statement of Facts. The Court accepted the State's late-filled response. 3. The parties are directed to the Court's earlier Orders 24 for a review of the legal standard for summary judgment motions. 4. The State does not cross-move for summary judgment on 28 this issue. 5. Plaintiffs' aside, concerning the lethal nature of methomyl, although interestng, was unnecessary. 21 ELR 20549 | Environmental Law Reporter | copyright © 1990 | All rights reserved |