Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-88-02958/USCOURTS-ca10-88-02958-0/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 

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PUBLISH 

JUL 811990 

&OBERT L. HOECKER 

UNITED STATES COURT OF APPEALS Clerk 

FOR THE TENTH CIRCUIT 

HECLA MINING COMPANY, ) 

) 

Plaintiff-Appellant, ) 

) 

v. ) 

) 

UNITED STATES OF AMERICA; JOHNS.) 

HERRINGTON, as Secretary of U.S. ) 

Department of Energy; A. DAVID ) 

ROSSIN, as Assistant Secretary ) 

for Nuclear Energy; JAMES D. ) 

ANDERSON, as Project Manager, ) 

Uranium Mill Tailings Remedial ) 

Action Project Office, u.s. ) 

Department of Energy; THOMAS ) 

VERNON, as Executive Director, ) 

Colorado Department of Health; ) 

and HOWARD ROITMAN, as Uranium ) 

Mill Tailings Remedial Action ) 

Project Manager, Colorado ) 

Department of Health, ) 

) 

Defendants-Appellees. ) 

No. 88-2958 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLORADO 

(D.C. No. 87-M-1638) 

Submitted on the briefs: 

Joseph M. McMahon, Jr., Elizabeth H. Temkin, and Roger L. Freeman 

of Davis Graham & Stubbs, Denver, Colorado, on the briefs for 

Plaintiff-Appellant. 

Donald A. Carr, Acting Assistant Attorney General for the Land and 

Natural Resources Division, U.S. Department of Justice, 

Washington, D.C.; Michael J. Norton, Acting United States Attorney 

for the District of Colorado; J. Greg Whitehair, Assistant United 

States Attorney for the District of Colorado; Dirk D. Snel, 

Jeffrey P. Kehne, and David w. Zugschwerdt, Attorneys for the Land 

and Natural Resources Division, U.S. Department of Justice, 

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Washington, D.C.; and P. Benjamin Underwood, Attorney, Office of 

General Counsel, U.S. Department of Energy, Washington, D.C., Of 

Counsel, for Federal Defendants-Appellees. 

Duane Woodard, Attorney General; Charles B. Howe, Deputy Attorney 

General; Richard H. Forman, Solicitor General; and Jerry w. Goad, 

First Assistant Attorney General, Natural Resources Section, State 

of Colorado, Denver, Colorado, for State Defendants-Appellees. 

Before McKAY, MOORE and ANDERSON, Circuit Judges. 

McKAY, Circuit Judge. 

This case involves an appeal from the district court's grant 

of summary judgment. The district court refused to declare plaintiff's land parcels part of a government-funded cleanup program 

and refused to order defendants to undertake remedial action at 

the sites. 

I. Facts 

Hecla Mining Company owns two parcels near Naturita, 

Colorado. The first parcel, the Naturita parcel, was used to produce uranium for contracts with the United States government from 

1939 to 1963. This production resulted in over 600,000 tons of 

waste known as tailings. In 1977, Ranchers Exploration and Development Corporation--Hecla's predecessor-in-interest--moved most of 

the tailings to a second site in Durita, Colorado. Ranchers then 

reprocessed the tailings at the Durita site recovering uranium and 

other metals. Ranchers worked under a Colorado license authorizing the movement and reprocessing. The license required 

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Ranchers to stabilize and control the waste produced by the 

reprocessing. 

In 1978, Congress enacted the Uranium Mill Tailings Radiation 

Control Act of 1978 ("UMTRCA"). The purpose of UMTRCA was to stabilize and control uranium tailings at sites throughout the country. Title I of UMTRCA focuses on inactive mill sites previously 

used to produce uranium for government contracts. Under Title I, 

a property is designated by the Secretary of Energy as a "processing site." Once a site is designated, the federal government 

funds ninety percent of the cleanup, while the states pay the 

remaining ten percent. The owners of the sites pay nothing for 

the cleanup of their property. 

The basic issue in this case is whether the Durita property 

should be designated as a "processing site." Although the 

Naturita site was originally at issue in this suit, both parties 

have now agreed that Naturita is covered by UMTRCA and must be 

cleaned up as required by the statute. The parties have been 

unable, however, to agree on the disposition of the Durita site. 

Section 7912 of UMTRCA directs the Secretary of Energy to 

designate, within one year, processing sites at or near twenty 

specified locations including Naturita, Colorado. 42 U.S.C. § 

7912(a)(l) (1982). The statute also provides that: 

Notwithstanding the one year limitation contained in 

this section, the Secretary may, after such one year 

period, include any area described in Section 7911(6)(8) 

of this title [describing sites in the vicinity of 

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actual processing sites] as part of a processing site 

designated under this section if he determines such 

inclusion to be appropriate to carry out the purposes of 

this subchapter. 

42 U.S.C. § 7912(e)(2) (1982). The Durita site was not designated 

during the first year after UMTRCA was passed. Thus, plaintiff 

argues that the defendants should designate the Durita property as 

a processing site under section 7912(e)(2). 

UMTRCA specifically defines what the Secretary is required to 

designate as a processing site. 

The term "processing site" means--

(A) any site, including the mill, containing residual 

radioactive materials at which all or substantially all 

of the uranium was produced for sale to any Federal 

agency prior to January 1, 1971 under a contract with 

any Federal agency, except in the case of a site at or 

near Slick Rock, Colorado, unless--

(i} such site was owned or controlled as of January 1, 

1978, or is thereafter owned or controlled, by any 

Federal agency, or 

(ii) a license (issued by the Commission or its predecessor agency under the Atomic Energy Act of 1954 or by 

a State as permitted under section 274 of such Act) for 

the production at such site of any uranium or thorium 

product derived from ores is in effect on January 1, 

1978, or is issued or renewed after such date; and 

(B) any other real property or improvement thereon 

which--

(i) is in the vicinity of such site, and 

(ii) is determined by the Secretary, in consultation 

with the Commission, to be contaminated with residual 

radioactive materials derived from such site. 

42 u.s.c. § 7911(6) (1982). 

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In 1979 and 1980, Ranchers sought the designation of the 

Durita property as a processing site in correspondence with the 

Department of Energy. DOE consistently refused Ranchers' 

requests. Hecla merged with Ranchers in 1984. On January 30, 

1987, Hecla again sought designation of the Durita property in a 

letter to DOE. DOE again responded in a letter dated March 13, 

1987, stating that UMTRCA did not require designation of the 

Durita property. DOE gave the same reasons it had given in 1980. 

Hecla (plaintiff) filed the current lawsuit seeking designation of 

the Durita property on October 24, 1987. Plaintiff now claims 

that the Secretary should designate the Durita property as a processing site under the "vicinity" property language found at 

section 7911(6)(B). 

After this lawsuit was filed, DOE filed notice in the Federal 

Register on April 28, 1988, proposing not to designate the Durita 

property. See Proposed Decision, 53 Fed. Reg. 15,273 (1988). 

After reviewing the comments on its proposed decision, DOE published an official refusal to designate the Durita property on 

July 19, 1988. See Final Decision, 53 Fed. Reg. 27,332 (1988). 

On October 19, 1988, the district court granted the government's summary judgment motion and dismissed plaintiff's claims. 

Plaintiff now appeals that dismissal. 

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II. Standard of Review 

In reviewing the district court's grant of summary judgment, 

we view the case in the same manner as did the district court. 

Osgood v. State Farm Mut. Auto. Ins. Co., 848 F.2d 141, 143 {lOth 

Cir. 1988); R-G Denver v. First City Holdings of Colorado, Inc., 

789 F.2d 1469, 1471 (lOth Cir. 1986). We must determine whether 

any genuine issue of material fact exists and, if not, whether the 

substantive law was correctly applied. See Fed. R. Civ. P. 56{c); 

Osgood, 848 F.2d at 143. Plaintiff does not challenge the factual 

determinations of the district court. Instead, plaintiff challenges the district court's process, standard of review, and conclusions of law. Thus, our duty is to see that the district court 

correctly applied the substantive and procedural law. 

The district court reviewed the administrative record to see 

whether DOE's decision was reasonable. Plaintiff claims that reasonableness review of DOE's legal determination was improper 

because the notice and comment proceeding itself was inappropriate. Plaintiff claims that notice and comment proceedings are 

inappropriate for pure issues of law and should be reserved for 

resolution of factual issues. Plaintiff also challenges the timing of the notice and comment proceeding, suggesting that DOE went 

through the procedure merely to bolster its litigation position. 

We hold that the notice and comment proceeding was within the 

requirements of the law. Plaintiff is simply incorrect in asserting that notice and comment procedure is inappropriate for legal 

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decisions. "The basic procedure for deciding a disputed question 

of law should be and usually is notice and comment 

procedure--receiving parties' briefs and perhaps listening to 

their oral arguments." 3 K. Davis, Administrative Law Treatise§ 

14.4 at 19 (2d ed. 1980). Plaintiff cites two cases indicating 

that development of a record in cases involving statutory interpretation is not necessary. See R.R. Yardmasters of America v. 

Harris, 721 F.2d 1332, 1338-1339 (D.C. Cir. 1983); United Transp. 

Union v. Dole, 797 F.2d 823, 828 (lOth Cir. 1986). However, these 

cases do not support plaintiff's assertion that notice and comment 

procedure was inappropriate in this case. Neither of the cited 

cases hold that notice and comment procedure is inappropriate in 

making legal decisions or in any other setting. They simply 

indicate that in statutory interpretation "development of a record 

before the agency or by the agency is not pressing," United 

Transp., 797 F.2d at 828, and that statutory development "does not 

require the development of a factual record," R.R. Yardmasters, 

721 F.2d at 1338. These cases do not hold that notice and comment 

proceedings are barred; they merely hold that such procedures are 

not required in resolving questions of law. 

In addition, UMTRCA specifically authorizes DOE to promulgate 

rules and to hold public hearings. "The Secretary may prescribe 

such rules consistent with the purposes of this chapter as he 

deems appropriate pursuant to Title V of the Department of Energy 

Organization Act." 42 u.s.c. § 7919 (1982). 

In carrying out the provisions of this subchapter, 

including the designation of processing sites, establishing priorities for such sites, the selection of 

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remedial actions, and the execution of cooperative 

agreements, the Secretary, the Administrator, and the 

Commission shall encourage public participation and, 

where appropriate, the Secretary shall hold public hearings relative to such matters in the States where processing sites and disposal sites are located. 

42 U.S.C. § 7921 (1982). These provisions indicate a 

Congressional emphasis on public input and rulemaking. The notice 

and comment proceeding furthers both goals. In addition, the 

Supreme Court has specifically held that the choice of what procedure to use lies with the agency. NLRB v. Bell Aerospace Co., 416 

u.s. 267, 290-94 (1974). 

Although neither the Administrative Procedure Act nor UMTRCA 

specifically authorize notice and comment procedure under the specific facts of this case, UMTRCA does authorize rulemaking and 

public hearings in the designation of processing sites. In addition, the APA authorizes notice and comment proceedings in general. These provisions, combined with the Supreme Court's ruling 

that the choice of procedures is left to the agency, support the 

DOE's procedure in this case. Thus, we hold that DOE was authorized to conduct a notice and comment proceeding under the facts of 

this case. 

Plaintiff next complains about the timing of the notice and 

comment proceeding. Plaintiff alleges that DOE engaged in the 

procedure merely to bolster its litigation posture. We find 

plaintiff's position unpersuasive. The possibility that DOE conducted the notice and comment proceeding because of the filing of 

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this lawsuit does not change DOE's authority to conduct the procedure. Plaintiffs cannot limit an agency's discretion to conduct 

administrative proceedings by filing a lawsuit. We hold that the 

timing of DOE's notice and comment proceeding, in relation to the 

timing of Hecla's suit, did not change the validity of the administrative action. 

Having concluded that the notice and comment proceeding in 

this case was authorized and appropriate, we review this final 

agency action to see if it is "arbitrary, capricious, an abuse of 

discretion, or otherwise not in accordance with law." 5 U.S.C. § 

706(2)(A) (1988). We previously applied this standard in a case 

very similar to the one at bar. 

For the type of informal notice-and-comment rulemaking 

at issue here, the APA specifies that agency action may 

be set aside if found to be "arbitrary, capricious, an 

abuse of discretion, or otherwise not in accordance with 

law." 5 u.s.c. § 706(2) (A) .... 

In determining whether an administrative regulation 

permissibly construes the statute that an agency is 

charged with enforcing, our inquiry is shaped by the 

specificity of the congressional enactment: . . . "If 

. • . the court determines Congress has not directly 

addressed the precise question at issue, the court does 

not simply impose its own construction on the statute, 

as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent 

or ambiguous with respect to the specific issue, the 

question for the court is whether the agency's answer is 

based on a permissible construction of the statute." 

Quivira Mining Co. v. United States Nuclear Regulatory Comm'n., 

866 F.2d 1246, 1249 (lOth Cir. 1989) (quoting Chevron U.S.A., Inc. 

v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843 

(1984)) (citations omitted). 

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The district court reviewed DOE's action under this standard. 

In reviewing the district court's grant of summary judgment on 

this issue, we adopt the same standard of review. By arguing that 

DOE's notice and comment procedure was contrary to law, plaintiff 

seeks to avoid our deferential review of DOE's legal conclusions. 

Instead, plaintiff seeks de novo review of the statutory interpretation issue. However, under the facts of this case even de novo 

review would involve deference to the agency's interpretation. 

"Although the construction of the statutes and regulations before 

us is for the courts, it does not follow that the agency interpretation is to be disregarded by a reviewing court. Deference is 

due the construction of a statute or a regulation of an administrative agency." Hoover & Bracken Energies, Inc. v. United States 

Dep't of Interior, 723 F.2d 1488, 1489 (lOth Cir. 1983). The 

Supreme Court has held that when Congress explicitly or implicitly 

delegates to agencies the power to elucidate a specific provision 

of a statute, the resulting agency action is entitled to deference. 

If Congress has explicitly left a gap for the agency to 

fill, there is an express delegation of authority to the 

agency to elucidate a specific provision of the statute 

by regulation. Such legislative regulations are given 

controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute. Sometimes 

the legislative delegation to an agency on a particular 

question is implicit rather than explicit. In such a 

case, a court may not substitute its own construction of 

a statutory provison [sic] for a reasonable interpretation made by the administrator of an agency. 

Chevron, 467 U.S. at 843-44. Congress delegated to DOE the power 

to designate processing sites under UMTRCA. The "vicinity" language of section 7911(6)(B) represents a gap Congress left the DOE 

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to fill. Thus, even in the absence of a notice and comment proceeding, we would at least give some deference to the agency's 

consistent position that the Durita site should not be designated 

under UMTRCA. 

III. Designation of a Vicinity Property 

This case comes down to the question of whether DOE's interpretation of UMTRCA is reasonable and permissible. DOE concluded 

that the Durita property did not meet the UMTRCA requirements for 

a vicinity property. In order to qualify as a vicinity property 

under UMTRCA, a site must meet at least three basic requirements. 

The property must (1) be in the vicinity of a processing site, (2) 

be contaminated with residual radioactive materials, and (3) the 

contamination must be derived from the processing site. See 42 

U.S.C. § 7911(6)(B) (1982). Both parties agree that the Durita 

property is nin the vicinity" of the processing site on the 

Naturita property. Both parties also agree that the Durita 

property is contaminated with radioactive materials. However, DOE 

argues that the contamination is not "residual radioactive 

material" and that it was not "derived from" the Naturita site. 

In addition, DOE claims that Ranchers' state license removes the 

Durita property from UMTRCA consideration. 

UMTRCA defines the term "residual radioactive material" as 

follows: 

The term "residual radioactive material" means--

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(A) waste (which the Secretary determines to be radioactive) in the form of tailings resulting from the processing of ores for the extraction of uranium and other 

valuable constituents of the ores; and 

(B) other waste (which the Secretary determines to be 

radioactive) at a processing site which relate to such 

processing, including any residual stock of unprocessed 

ores or low-grade materials. 

42 u.s.c. § 7911(7) (1982). DOE's position is that the material 

taken from the Naturita site to the Durita site was not "waste" as 

required by the definition of residual radioactive material 

because the material was used as the raw material for a processing 

plant that produced uranium for commercial sale. Therefore, DOE 

argues that the material at the Durita site is not residual radioactive material. 

DOE's interpretation of the statute is questionable. After 

the definition of vicinity property, the statute states: 

A license for the production of any uranium product from 

residual radioactive materials shall not be treated as a 

license for production from ores within the meaning of 

subparagraph {A)(ii) if such production is in accordance 

with section 7918(b) of this title. 

42 u.s.c. § 7911{6) (1982) {emphasis added). This language 

clearly indicates that uranium can be produced from "residual 

radioactive materials"--just as occurred at the Durita site. This 

sentence implicitly assumes that tailings used to produce uranium 

can still be designated as residual radioactive materials. Thus, 

DOE's conclusion that residual radioactive material is no longer 

waste--and therefore no longer residual radioactive material--when 

it is used to produce uranium is incorrect. We hold that DOE's 

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interpretation of the statutory language "residual radioactive 

material" is unreasonable. 

However, we uphold on other grounds DOE's ultimate conclusion 

that the statute does not include the Durita site. First, we 

agree with DOE's finding that the residual radioactive material at 

the Durita site is not "derived from" the Naturita site. UMTRCA 

does not define the meaning of "derived from." However, we conclude that DOE's position--that the waste at the Durita site is 

"derived from" the processing on that site and not from the 

Naturita mill--is a reasonable interpretation of the statute. If 

Ranchers had merely transported the tailings to the Durita site 

for safer storage, then they would be derived from the Naturita 

site. However, when the tailings are used as raw material in a 

reprocessing procedure, we hold that it is a permissible interpretation of the statute to categorize the "new" waste produced by 

the reprocessing procedure as material "derived from" the new procedure at the new site. UMTRCA was enacted to make safe uranium 

tailings that were produced in order to fill government contracts. 

When these tailings are subsequently used in a private commercial 

reprocessing venture, the resulting residual radioactive material 

is derived from the commercial venture and not the initial processing at the production site. 

In addition, we find DOE's interpretation of the statute reasonable because of the licensing limitation found in the statute's 

definition of processing sites. The statute excludes from the 

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definition of processing site any properties for which a state 

license for the production of uranium was in effect on or after 

January 1, 1978. See 42 u.s.c. § 7911(6)(A)(ii) (1982). Ranchers 

obtained its reprocessing license from the state of Colorado in 

1977. Thus, if the license limitation found in section 

7911(6){A)(ii) applies to the Durita property, the site is clearly 

not covered by the statute. 

Unfortunately, the statute does not make clear whether the 

license exception was intended to apply to vicinity properties. 

The exception is contained in subsection (A) of the definition of 

processing site, while the definition of vicinity properties is 

found in subsection (B). However, immediately following subsection (B)--with no separate numerical designation--is the language previously quoted concerning licenses to produce uranium 

from residual radioactive materials. This language provides that 

the license exception does not apply to licenses given for production of uranium from residual radioactive materials if such production is in accordance with 42 u.s.c. § 7918(b) (1982). It is 

undisputed that Ranchers' production at the Durita site was not in 

accordance with section 7918(b). We think a fair inference from 

this language is that if production from residual radioactive 

materials is not in accordance with section 7918(b), then the 

license exception applies and the government is not obliged to pay 

for the cleanup of the property. We also believe that the placement of this language following subsection (B) makes the statute 

ambiguous as to whether the language is meant to apply to the 

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vicinity properties under subsection (B) or solely to the processing sites defined in subsection (A). DOE applied the licensing 

exception to the Durita property. We hold that this is a permissible interpretation of the statute. 

The legislative history of UMTRCA also supports DOE's interpretation of this ambiguous statute. One House report on UMTRCA 

states: 

The committee questioned the expenditure of Federal 

funds to clean up uranium mill tailings in cases where 

the commercial uranium milling industry can be required 

through regulatory authorities to assume those costs. 

It would seem therefore, that the Secretary of Energy 

need not designate any sites to be included in the 

authorized program which are currently under active 

license, or which contain tailings from commercial production, unless it can be shown that the tailings hazards could in no way be remedied without such designation. 

H.R. Rep. No. 1480(!), 95th Cong., 2d Sess., pt. 1, at 13, 

reprinted in 1978 U.S. Code Cong. & Admin. News 7433, 7436. Thus, 

at least the House Interior and Insular Affairs Committee felt 

that the government's obligations under UMTRCA would be limited to 

sites that were not under active license requiring the stabilization of the tailings. 

The House Interstate and Foreign Commerce Committee also 

reported its belief that the main purpose for enacting UMTRCA was 

to clean up tailings where the owners of the property were not 

then under any state or federal obligation to perform their own 

cleanup. 

The lack of any control over these inactive sites under 

the 1954 act and other laws to require clean up of these 

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sites is the principal basis for committee action to 

authorize this remedial program. This situation does 

not exist at active mill tailings sites. 

. . • [W)e stress that the lack of any specific 

statutory authority requiring the effective stabilization of these mills by the NRC or the States after 

operations ceased and licenses terminated is the principal reason for recommending this program. 

H.R. Rep. No. 1480(!!), 95th Cong., 2d Sess., pt. 2, at 30, 

reprinted in 1978 U.S. Code Cong. & Admin. News 7450, 7457. 

Because the Durita site was under active license requiring the 

stabilization of the tailings, the legislative history indicates 

that Congress did not intend for the Durita property to be designated a processing site. 

Plaintiff continually refers to the broad language found in 

the purposes section of UMTRCA stating that the statute is 

intended to "stabilize and control such tailings in a safe and 

environmentally sound manner." 42 U.S.C. 7901(b)(1) (1982). However, even this section is specifically limited to "inactive mill 

tailings sites." Id. Thus, we conclude that DOE's application of 

the license exception to a vicinity property is a permissible 

interpretation of the statute. We hold that DOE's 

conclusion--that the Durita property does not fulfill the statutory requirements for a processing site--is reasonable. Therefore, we affirm the district court's grant of summary judgment for 

all the federal government defendants. 

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IV. Claims Against the State of Colorado 

The state of Colorado would be liable for its share of the 

cleanup costs only if DOE properly designated the Durita property 

as a processing site. * In light of our conclusion that DOE properly refused to designate the Durita site as a processing site, we 

affirm the district court's grant of summary judgment for all of 

the state defendants. 

V. Mandamus Authority 

The issue whether the district court had authority to order 

DOE to designate the Durita site for cleanup is rendered moot by 

our resolution of the statutory question. Because we affirm DOE's 

decision that the Durita property is not covered by UMTRCA, it is 

unnecessary for us to consider whether the district court had the 

power to order DOE to act. 

VI. Conclusion 

Although we find part of DOE's interpretation of UMTRCA to be 

contrary to the language of the statute, we uphold DOE's ultimate 

conclusion that the federal and state governments are not required 

to pay for the cleanup at the Durita site. We affirm the district 

court's grant of summary judgment for all defendants. 

AFFIRMED. 

* The Colorado defendants have already settled their liability 

regarding the Naturita site. 

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