a brief apology to mr gerson gordon is corporally to not have given you more time to let you know that you have more time so we will be proceeding with twenty minutes per side in mr company mr gerson gore will begin with you morning your honour's in may it please the court my client w c l is the buyer in a dispute about whether the buyer or the seller has responsibility under a sales contract for money to railroads paid to settle environmental litigation a crater park in wisconsin in granting summary judgment for the seller the district court erred in two principal ways st the court erred in concluding that no claim had been asserted against the railroads within the relevant timeframe by nine hundred and ninety five dollars well within the ten year time period the principal polluter and s p knew that it faced massive liability it concluded that the railroad shared in that liability it had legal rights it could set a certain against the roads and it had met with the railroads armed with lawyers evidence and studies to discuss what it described as the railroads quote potential responsibility for environmental issues that crater park representatives from both railroads understood that a claim had been asserted and the railroad chose to coordinate a joint response to the claim on these facts under minnesota law a claim was asserted nd the district court erred when it saddle distinct busy right the commercial dock was gifted away and we didn't purchase its distinct operationally the railroad was able to operate its and do its operations long after the commercial dock had been given away it's distinct chronologically right the dredging that we're talking about here the environmental claims happened at the turn of the of the last century in the early one thousand nine hundred s and we bought the modern operations of  of su line and so it's distinct chronologically and it's distinct legally your honour's can see that at the supplemental appendix page one hundred and fifty six where the united states explains the basis of superfund liability and distinguishes between r not rationed on the one hand and the dredging at the commercial dock on the other hand and so we think that any sort of reasonable understanding of the term relating to would not make w c l on the hook for all of damages for spilled as a result of activities at or around the crater park and the treating of the railroad ties at the site do you agree that if you're responsible for all of the damages and we reject share of your footprint argument do you agree that those two categories of damages are related to the operation l s t so your honor i think we don't to the extent those are at the commercial dock itself there was a real track on the commercial jock but we didn't purchase that and so you know i think there would be some incident with that course you're talking about the commercial back doesn't the commercial tack go with the dredging category not the career park category i'm asking about the other two categories so we're not we're not contending i think what i would say your honor is the commercial dock is emblematic of the district court's error in the sense that the district court gave us all of the damages the only evidence that had been put in to allocate was actually our evidence that it was fifty four percent fifty four percent our fault and and the rest sue line there was nothing else before the district court so actually on the record before this court i think it actually is sort of an all or nothing choice if the court just agreed with that i think the district court would have some flexibility to decide what's properly allocated to us and what's properly tack and it being physically operationally chronologically legally different answered the way i read that record i connect the commercial back with the dredging operations because that was part of it there are two other categories according to the settlement letter that the settlement was for the st one the hazardous substances at career park and the rd one the treating of the railroad ties at the site that's these five million covered all three of those categories my question to you please ten million your honor covered and yes i've taken your portion of it yes the ten million a total but your portion of it do you agree that the st and the rd category so they hazardous substance career park and the treating of the railroad ties are related to the operations of the ellis t line follow up on that one second and i'll let you get back on track no allocation was made was there no allocation made in connection with settlement or no allocation made by the district court or book the letter the letter your honor no apparent allocation in the settlement that's anywhere in the record not that i'm aware thank you it better and i would say your honors have started with the damages question which of course we feel very strongly about but i'd like to pivot if i could to the liability question and then and the question about and if i could focus the court's attention on the may nd meeting with at the offices of michael best and sort of three basic points i want to focus the court on what happened before the meeting what happened at the meeting and how people perceive the meeting remember before the meeting n s p had quote made a determination that the railroads were potentially responsible parties with respect to contamination the greater part that's in the supplemental appendix forty five dollars and s p had been named a potentially responsible party by wisconsin which meant according to the letter they had quote a statutory responsibility to restore the environment and minimize the harmful effects of the release of waste and rd when they asked for the meeting the testimony their own testimony was the purpose of the meeting was to discuss quote wisconsin central to potential responsibility for environmental issues that's in supplemental appendix forty nine dollars then of course in prep for the meeting right they came armed with lawyers evidence and studies before th meeting they sent to dams and more report that quote confirmed the regular dumping of some kind of waste by the railroad car since it s a seventy five dollars and at the meeting their lawyers handed over a status report that said that n s p had quote found close quote through its investigation that quote the railroad may have contributed to the site after the meeting and of course they handed over an index of five hundred dollars index of documents in advance of the meeting which is also in the supplemental jointly agreed to coordinate their defense to the claim we think in that city lation a claim has clearly been asserted under the contract now the district court viewed all that as just what she described as quote an invitation to voluntarily contribute with respect we don't think that's a fair characterization sophisticated corporations represented by employers showing up at meetings handing out reports are not making invitations to pollen generally contribute what about the fact that this arises from wisconsin's investigation and wisconsin's identifying of n s p under the law under given that investigation n s p doesn't have a right survived a motion to dismiss but i'm sure it would be a separate negligence claim it couldn't be a contribution claim under the law could it it could be a rd party contribution claim to wisconsin's investigation wisconsin's claim against honest right around what we think is they had a negligence claim against the railroads for money to be paid that they were having going to have to pay out to wisconsin and then remember that that claim actually was brought and it survived a motion to dismiss now that the fact that they didn't mention that claim or raise the claim doesn't change the case was very clear you don't have to cite legal authorities but remember what the purpose of this clause it's right the imagine this it happened in your one instead of that year eight of the ten year period if w c l had had this meeting with with an s p and then had sat on it and twiddle their thumbs meanwhile wisconsin had gone ahead and n s p had developed a record in the and debate and then six years did we did turn to sue line and say oh yeah by the way there's this claim they would have said what are you talking about how could you not tell us about this of course we want to get involved and how do you know that well section eighteen b s twenty four ms quarterly is brief they make the so line makes the argument we're joined on from their associates claim is a similar vein to demand action suit and proceeding it strikes me that the description of the claim that you're talking about there and the notice that one would want to make for purposes of indemnification if we're looking at those other words actions suit and proceeding those would have a strength that perhaps doesn't bear the weight here  what was done what i think that's exactly i think that is exactly right your honor this there are contracts of course that require a suit a legal proceeding this doesn't it requires a claim and actually elsewhere in the contract to reinforce your honor's point and section fo makes clear that sometimes even just a request for information can be assumed we are of course are talking about a claim so what does a claim mean and your honor is exactly right it takes it takes its meaning from the terms around it but also  interesting was it rejects the idea that it has to be quote a written legal demand for monetary relief within which is an express or implicit threat to sue that really is getting close to the other  those kinds of things and so we do think that that claim has a much reduced degree of formality and i think again what the other side would sue on's position is is that it has to be an assertion of a legal all right one is not free to ignore that's not what a claim is and the purpose you know the combination of the other terms around and the notice provision the purpose of the new distribution i think all william forced mr green when i went to go back to where you were mentioning a moment ago the meeting somewhat glib facetious answer which is you can't represent to the extent the client waves and the client wait but i understand that and so that's the short answer but to go to your honor's question directly if you set s a one hundred and twenty t sort of the waiver that eventually comes out and the waiver says the waiver is premised on the idea that there is that versus right and what the waiver says is that michael best can represent n s p in quote related cos recovery or contribution litigation against w c l again this goes back to judge brennan's point it doesn't say you can't represent them if you're going to assert a claim or if you're going to assert a rate legal right it says you can't represent them in contribution or cost recovery litigation that's if they had filed suit of course the meaning of that letter just as we think it's actually clear and helps us but the district court thought otherwise at the very least that's not something the district court could have granted summary judgment honest against the question of exactly what what genet gilbert was thinking and what he was thinking at the time that the waiver was granted is of course not something that could be resolved in summary judgment but we don't think that the light that waiver letter is enough to undercut the formality of that meeting and i again i think in the real world just getting back if i might just seeing you back to the to the facts of that meeting you know in the real world you don't hire your lawyers to come in and just say oh here's some here's a request for information or here's facts or please contribute voluntarily write an invitation to voluntary can contribute is what i say to a friend if i want to borrow some of their much it's not what one company says to another when when that company has already been named a p r p now remember that happened and is i think really the trigger point for the name eating  a real world he's not going to bring in lawyers who you think to represent you against a client who you think might be adverse to you so your honor i guess i would say two things i think actually there are a host i think clients have a range that they actually could represent both there is no doubt let me put it this way there is no doubt that money that my client would have put into the sea lion would have put it would have reduced s p's and s p's liability and so i think looking at the waiver letter it is is really is really the tail wagging the dog in a way that i don't think is appropriate period but certainly not appropriate and summary judgment i mean if there is the fact finder wants to take testimony as to what my client meant as to the waiver and what the significance of that is fine but i don't think any of that can overcome the fact that there's a degree of formality in the tone in the approach in what n s p thought going in which was that the railroads were responsible and how it was perceived by both by both w c l and cline and how they work together mr gerson was your intro your rebuttal time and you want to reserve the remainder i would can take years and years even decades or a century to concha like and it can be many more years before a claim is a circuit and of course environmental claims often have nothing to do with faults there are strict liability based on ownership that's why the parties here agreed to a bright line cutoff for liability it was the idea of the seals lenders actually to give them certainty during the early period of their loan so what y when we're talking about that build language this liability provision you know the district court held that the liability here belongs to w c l because no claims were asserted against the railroad railroad no one took any administrative action against the railroads no government agency names w c l as a potentially responsible party no one sent a letter to a railroad saying claims period the wisconsin state agency said nothing whatsoever about any responsibility of the railroad it was only after the end of the claims cure period that the wisconsin state agency issued a potentially responsible party letter with respect to solid waste in other words debris that was discarded on the right of way but in subsequent correspondence to watching the wisconsin state agency made clear that there was no liability associated with it was simply debris in the railway in the right of way it was not a hazardous substance so the state agency never said that any railroad was responsible in any way for hazardous substances and that's what this case is about it's about hazardous substances we all agree that that solid waste is not it is shoe in this case and in any event again that didn't happen until after the claims  you my colleague referred to the rich trauma case and put a lot of emphasis on it and i just wanted to speak about that case and about the cases generally all of the authorities stated cited by  o involved some sort of request that there was some legal force behind and we know both from the law and from the power company's own concessions that the power company had no right under wisconsin law to force the railroads cut to come to the negotiating table what it was trying to do actually was to get the state agency to force the railroad to the negotiating table and of course that effort failed every single one of the supposed claims that were asserted by the power company and when you asked them what they are what they point to is a newspaper article in which  someone from the company said that liability for the cleanup could include the railroads this investigator to report on the content of the meeting the michael best office that we've discussed was about potential liability as a potentially responsible party of course the power company does not have the power to declare the railroads to be a potentially responsible party the only one who can do that is a government agency and what the power company didn't  discussed earlier in the only damages that you see all claims in negligence ever even when it ultimately asserted that claim fifteen years later was the costs that each had incurred in repairing the cleanup well that's not negligence claim that's a contribution claim and wisconsin law is clear that a common law negligence claim lies only when the party can claim damage to property  property someone else owns otherwise that would be a contribution claim the it is true that that claim ultimately survived a motion to dismiss that but but that was fifteen years later the claim was the tail wagging the dog and there were it was an argument made in a motion to dismiss that all of those claims were preempted the court ruled that that ground for a motion to dismiss was premature and it dismissed and it denied the motion but this issue that i'm raising today about whether a negligence claim even lies when you don't have to average against your own self was never briefed or decided by any court to shift to the damages portion for a moment please the district court ruled that it is undisputed that the superfund claims arose from the operation of the l s t but she didn't  anything supporting that statement what in the record support that conclusion that it's undisputed that the settlement claims arose from the operation of the railroad the being asserted by the e p a which was never a lawsuit it was a p r p determination that the claim that was being asserted by the e p a did not rest on any specific act or contribution to the contamination  fact that they owned the right of way and that was clearly an asset that was acquired in this transaction so that's the basis for the e p a liability and that covered the entire settlement that the language is now now sure you're right but what's relevant here is that the contract language and right so i'm trying to to link that was the foundational statement for the damages determination by the district court so i'm trying to arrange that back to the contract language here that it has to be related to the operation of the l s t so the the work is being done in that sense related to the operations of l s t the work is being done by operations of a n l s t not relating to the operations about what this contract it was it actually didn't use the language to describe the modern day operations of su line in this district which is it was called the lake state transportation division that language is missing entirely from this purchase agreement what the purchase agreement referred to was operation of l s t that the railroads did in connection with prayer parking in that region had to do with the operation of that line that's the business they were in they were in the business of operating not mind doing road business so what is a record supports that the dredging of that been which was part of the settlement was related to the apparition of the elysee rail line well i what i will tell you there isn't certainly put before the court it was it was and i want to be i want to be clear what i mean about that the the parties so the parties agreed that if one side or the other one summary judgments the only thing that would be left is damages and they allowed sixty days for that discovery and they agreed that that discovery would entails certain kinds of basic prove up things like how much was yourself on a payment and what were your attorneys what what l did at that point was inject this new idea which is that the damages should somehow be allocated based on what did or didn't happen in eighteen and that was never part of this contract and to the contr liability based on who caused the contamination and that's what w still is trying to do here it's trying to point the finger and say but your responsible and then i heard mr gerson go and say it this morning he said it's fifty two percent our contractual language that defines what kind of damages you're entitled to environmental matters relating to the ownership of the assets or the operation of the l that seemed to be the basis of what the district court it right will that there are two different ways to get there in the district were talked about one of them and i agree with that of course and we prove it like that ever if there is another way to get to the same result which is through assets acquired when when there's actually a claim filed you look at the complaints here we're talking about liability under circlip based on ownership that's what the e p a alleged as a basis for a potentially responsible and the real rogue are responsible party therefore the united states perspective it is not necessary to allocate liability among the parties based on what each party did or me contributed at the site for more than one hundred years of operation but even i understand that language is there but under the contract and what you have agreed to with w c l it seems that it sue lines responsibility to identify how these damages would fall within the operation of the l s t and back to my question i'm trying to figure out how in particular the dredging of the bay which is one of the categories of settlement how that is related to the appalachians the l s t line or or of it could also fall within related to the ownership of the assets but i think that right stretch so the apparition of the l s t looking through the record and looking through the district court's holding what evidence was it mid that proves that the dredging expenses from whatever time they took place are related to the operation of the record referred to a couple of there were a number of different kinds of dredging that occurred over one hundred years some of the dredging over the years was done by the army corps of engineers in the early th century some dredging was done in  creating the commercial dock in that but the dredging that whatever dredging was done by su line for the commercial dock that it built was necessarily part of its railroad operations so sue line and it's predecessor were never dredging company they were never boating companies there were railroad companies and they built a commercial dock to it vance the rail line that went through prayer park which is the actual dispenser line the only railroad in town and the whatever whatever suleiman and its predecessor railroads did in that vicinity was in service of its rail business there's never been any suggestion that sue line started a new limiting i think you've answered it well with regard to judge see any of us to how far that language goes but how the panel as we look at that particular language it strikes me there's three areas that could be potentially in dispute related to the operation of an l s t l s t is the of those three possibilities is the most objective or well delineated and certainly we're familiar from the  with page twenty nine dollars which defines the ashland dispenser railroad line and essay sex which talks about all the interests of sue in the lines of railroad described in exhibit a l s t so the contract gives us some grounding with regard to what that means but that how elastic that provision is going to be is is going to i think affect the panel's analysis with regard to whether there should be a  not what is your argument with regard to what that phrase how that phrase should be interpreted for purposes of our work so i think that phrase the phrase operation of  has to be understood in the context of that whole of the whole provision of course and the other thing that immediately precedes operation of l s t is it says all claims for inveigled man environmental matters relating to the ownership of the assets or the operation of a list too so look that or tells us is that if the operation of ellis teeth is in there to take the life bill it beyond the specific assets acquired now as i've explained before i think we get to one hundred percent of this indemnification just by looking at assets acquired because the right of way was the sole basis for determining for the e p a s determination that the railroad was a potentially private responsible party that was actually sole basis was the ownership of the right of way which where but but what we know what we can tell about the operation of l s t is it was intended to go beyond the ownership of the assets there's no question that this in part we're talking about environmental liability that extends back more than one hundred years but that's the way environmental liability works you're liable if you are strictly liable based on your ownership of property for whatever happened there a century before that's just the way environmental liability works so although that does seem long and it seems attenuated that's a function of the scope of our  surplus which creates that extensive liability that's not a function of this agreement which included not only ownership of the assets including the right of way but also operation of l s t and the only thing that could be doing in that sentence is extending the liability to the historical operation of the listing and the historical operation until it included whatever the railroads were doing in crater park because the only thing they were ever doing in korea is operating actually in the spencer line including their work whatever it was associated with the commercial thank you will be recognised as ripple is there any further questions that you might have of his quarterly thank you your honor i have a couple of quick points on claim in a couple of quick points on the damages claim i want to just address judge ripples question about whether this state agency thought they were a minor player the key point for us is that the claim  being asserted not by the state agency but by an s p and there is no doubt that n s p thought that the railroads were that the railroads were potentially responsible parties with respect to the contamination now miss coverly said that there was no claim because there was no present harm but of course the n s p had suffered present harm it had already for example expended money to do six borings that's on page essay forty two there was present harm there was certain harm flowing from the p r p n s p had a present legal right the fact that they didn't put it in a letter another point discovery made it our case is stronger than that right they didn't put it in the letter because they had a meeting with their lawyers where they said we have found that you are potentially responsible at the site so we think a claim was asserted when we shifted down to just a couple of quick points we don't dispute of course that environmental liability c shift back a century but this is not a case asking which side is has a higher mental liability it's which side has contractual lightly and it is not a reasonable reading of the contract to say that relating to which discovery had no limiting principle at all said everything relates to it's not a reasonable reading of the contract to say that it relates to our purchase to damages that were done by property that was sold off five years before we even came on the s we wish all of and please pass this on to your teams as well we wish all of our briefing was this good thank you very much thank you thank you one case we take an