Third Circuit Reverses DuPont Due To Atlantic Research Decision

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November 22 and 23, 2007,

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Nov 20: In the case of E.I. DuPont de Nemours & Co. v. U.S., the U.S. Court of Appeals, Third Circuit, Case No. 04-2096, has reversed its previous decision in the case in light of the U.S. Supreme Court decision in United States v. Atlantic Research Corp. [See WIMS 6/12/07]. In its opening discussion the Third Circuit indicates that the case is being reviewed on the order of the Supreme Court of the United States dated June 18, 2007, which granted the petition for a writ of certiorari filed by DuPont, vacated the previous judgment of Third Circuit and remanded the case for further consideration in light of its opinion in Atlantic Research Corp., 551 U.S. , 127 S. Ct. 2331 (2007). In their earlier opinion the Third Circuit majority held that DuPont could not pursue an action under CERCLA to recover from the United States a portion of its cleanup costs. The dissenting opinion would have held that DuPont could maintain an action for cost recovery under § 107 of CERCLA.

In its Atlantic Research Corp decision, the High Court succinctly summarizes its opinion saying, "Two provisions of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) -- §§107(a) and 113(f) -- allow private parties to recover expenses associated with cleaning up contaminated sites. 42 U. S. C. §§9607(a), 9613(f). In this case, we must decide a question left open in Cooper Industries, Inc. v. Aviall Services, Inc., 543 U. S. 157, 161 (2004): whether §107(a) provides so-called potentially responsible parties (PRPs), 42 U. S. C. §§9607(a)(1)–(4), with a cause of action to recover costs from other PRPs. We hold that it does." The Third Circuit Appeals Court said, "In light of the Supreme Court’s order, we return to the issue presented."

In the DuPont case before the Third Circuit, DuPont admits that its industrial facilities throughout the U.S. are contaminated with hazardous waste and it contaminated those sites, but alleges that the United States also contaminated parts of the sites. After DuPont voluntarily cleaned up a site jointly polluted by both DuPont and the government, DuPont filed this suit under CERCLA seeking an order requiring the government to reimburse it for a share of the cleanup costs.

On its review, the Third Circuit says, "The Supreme Court decision thereafter in Atlantic Research Corp... is dispositive of the issue before us. Atlantic Research, a PRP, had contaminated the soil and groundwater at an ammunition facility with burned fuel, but the United States had also polluted the site... Atlantic Research voluntarily cleaned up the site, even though it had not been the subject of a suit under §106 or § 107... It then sued the United States under both §§ 107(a) and 113(f) to recover a share of its voluntary cleanup expenses... The Court, in a unanimous opinion authored by Justice Thomas, held that, although Atlantic Research could not sue the United States under § 113(f) in that case because no §106 or § 107 action was pending or had been brought against Atlantic Research, it could bring a cost recovery claim under §107(a)..."

The Appeals Court states further that, "Voluntary cleanups are vital to fulfilling CERCLA’s purpose. During deliberations on the SARA Amendments, Congress emphasized the importance of voluntary action... Although supervised cleanups are to be encouraged wherever possible, they need not be encouraged at the expense of unsupervised cleanups. Under § 107(a)(4)(B), a party is liable for costs incurred in a cleanup (voluntary or otherwise) only insofar as those costs are 'costs of response incurred by any other person consistent with the national contingency plan...' By the plain text of the statute, a party that seeks recovery for costs incurred in a cleanup that does not comport with the national contingency plan is without recourse. Because there has been no suggestion that DuPont’s cleanup is in that position, it has stated a viable cause of action for cost recovery under § 107(a).

"For the reasons set forth, we will reverse the decision of the District Court with respect to any claim made by DuPont for costs incurred while undertaking voluntary cleanup efforts and remand for further proceedings in accordance with this opinion."

Access the complete 17-page opinion (click here). [*Remed]