FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

STATE OF CALIFORNIA 

DEPARTMENT OF TOXIC SUBSTANCES

CONTROL, a State Agency, No. 09-55389

Plaintiff-Appellee, D.C. No.

v.  8:06-cv-00987-VBFMLG HEARTHSIDE RESIDENTIAL

CORPORATION, a Delaware OPINION

Corporation,

Defendant-Appellant. 

Appeal from the United States District Court

for the Central District of California

Valerie Baker Fairbank, District Judge, Presiding

Argued and Submitted

June 9, 2010—Pasadena, California

Filed July 22, 2010

Before: Dorothy W. Nelson and Ronald M. Gould,

Circuit Judges, and James S. Gwin, District Judge.*

Opinion by Judge Gould

*The Honorable James S. Gwin, United States District Judge for the

Northern District of Ohio, sitting by designation. 

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COUNSEL

Edmund G. Brown, Jr., Attorney General, Donald A. Robinson (argued), Supervising Deputy Attorney General, Los

Angeles, California, for the plaintiff-appellee.

Marc C. Forsythe, Goe & Forsythe, LLP, Irvine, California,

for the defendant-appellant.

CALIFORNIA v. HEARTHSIDE RESIDENTIAL 10553
OPINION

GOULD, Circuit Judge:

This appeal presents a question of first impression whether

“owner and operator” status under the Comprehensive Environmental Response, Compensation, and Liability Act

(“CERCLA”), 42 U.S.C. § 9607(a)(1), is determined at the

time that cleanup costs are incurred or instead at the time that

a recovery lawsuit seeking reimbursement is filed. We hold

that the owner of the property at the time cleanup costs are

incurred is the current owner for purposes of determining

CERCLA liability.

I

In 1999, Hearthside Residential Corporation (“Hearthside”)

bought an undeveloped tract of wetlands known as the Fieldstone Property in Huntington Beach, California. The Fieldstone Property was adjacent to several residential parcels

(“Residential Site”) that Hearthside never owned or occupied.

When Hearthside purchased the Fieldstone Property, it knew

that the property was contaminated with polychlorinated

biphenyls, or PCBs, a man-made substance considered toxic

to humans and animals.

In 2002, Hearthside entered into a consent order with the

State of California Department of Toxic Substance Control

(“Department”) by which Hearthside agreed to remediate the

PCB contamination on the Fieldstone Property. The Department determined that the adjacent Residential Site was also

contaminated with PCBs, which the Department alleged had

leaked onto the Residential Site from the Fieldstone Property.

The Department considered Hearthside responsible for investigating and remediating the Residential Site in addition to the

Fieldstone Property, but Hearthside disagreed that it bore

responsibility for the Residential Site and limited its cleanup

to the Fieldstone Property. The Department certified that the

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Fieldstone Property cleanup was complete on December 1,

2005, and within the same month Hearthside sold the Fieldstone Property to the California State Lands Commission.

Following Hearthside’s disclaimer of responsibility for the

PCBs on the Residential Site, the Department itself contracted

to clean those parcels and incurred cleanup expenses between

July 2002 and October 2003. In October 2006, the Department filed a complaint against Hearthside seeking, in relevant

part, reimbursement for the Residential Site cleanup on the

basis of (1) the Department’s allegation that the Fieldstone

Property was the source of the Residential Site contamination,

and (2) Hearthside’s ownership of the Fieldstone Property at

the time the Residential Site was cleaned. Under the Department’s view, Hearthside was the “owner” of the contamination source at the time of the cleanup, and thus was

responsible for the remediation costs under CERCLA. See 42

U.S.C. § 9607(a). Hearthside disputed liability, arguing that

“owner” status was determined at the time the recovery suit

was filed—not at the time cleanup costs were incurred—and

that Hearthside was not responsible for the Residential Site

cleanup costs because it sold the Fieldstone Property before

the Department filed suit.

The district court granted partial summary judgment in

favor of the Department on the limited issue of whether

Hearthside was an “owner and operator” of the Fieldstone Property.1

 After finding a “dearth of meaningful or controlling

case law,” the district court concluded that the purposes of

CERCLA support a holding that “owner” status is determined

at the time a response-recovery claim accrues, not at the time

the lawsuit is initiated. The district court also granted the parties’ joint request that the question be certified for immediate

appeal, and we exercised our discretion to permit the appeal.

1The district court originally ruled for Hearthside on the ownership

issue, but changed course after a renewed motion for summary judgment

by the Department that focused more expansively on this issue. 

CALIFORNIA v. HEARTHSIDE RESIDENTIAL 10555
See 28 U.S.C. § 1292(b). We review pure questions of law

decided on summary judgment de novo. Bjustrom v. Trust

One Mortgage Corp., 322 F.3d 1201, 1205 (9th Cir. 2003).

II

[1] CERCLA imposes “strict liability for environmental

contamination” upon four classes of potentially responsible

parties. Burlington N. & Santa Fe Ry. Co. v. United States,

129 S. Ct. 1870, 1878 (2009). CERCLA liability is joint and

several, meaning that a responsible party may be held liable

for the entire cost of cleanup even where other parties contributed to the contamination. Fireman’s Fund Ins. Co. v. City of

Lodi, 302 F.3d 928, 945 (9th Cir. 2002). The party saddled

with the cleanup costs may, in turn, sue other potentially

responsible parties for contribution. Id. 

[2] At issue here is one type of potentially responsible

party: “the owner and operator of a vessel or a facility.” 42

U.S.C. § 9607(a)(1). We interpret this category to refer to

“current” owners or operators. See Carson Harbor Vill., Ltd.

v. Unocal Corp., 270 F.3d 863, 881 (9th Cir. 2001) (en banc);

accord, e.g., United States v. Capital Tax Corp., 545 F.3d

525, 530 (7th Cir. 2008); ITT Indus., Inc. v. BorgWarner, Inc.,

506 F.3d 452, 456 (6th Cir. 2007). CERCLA’s definition of

“owner,” however, does not specify the proper date from

which to measure ownership. See 42 U.S.C. § 9601(20). In

this regard, the statute is silent. It is the measurement date that

is at issue in this appeal.

A

There is no controlling or persuasive precedent that

answers the precise question before us. Both parties direct us

to cases containing a rule statement phrased in their favor.

The cases marshaled by the Department state that ownership

is measured from the cleanup date, but a review of those decisions reveals that the statements were made in passing, where

10556 CALIFORNIA v. HEARTHSIDE RESIDENTIAL
the critical date was not in dispute. See, e.g., AM Int’l, Inc. v.

Int’l Forging Equip. Corp., 982 F.2d 989, 997 (6th Cir. 1993)

(stating in passing that property ownership is measured “at the

time of its cleanup” in a case where the ownership date was

not at issue); Nurad, Inc. v. William E. Hooper & Sons Co.,

966 F.2d 837, 840-41, 845 (4th Cir. 1992) (stating that the

current owner is the one who “undertakes the task of cleaning

up the environmental hazard,” though the ownership date was

not at issue because the same owner both cleaned up the property and filed the reimbursement suit).2

 We regard these statements as dicta rather than as “an intended choice of a rule,”

and therefore decline to accord them persuasive weight. See

Pakootas v. Teck Cominco Metals, Ltd., 452 F.3d 1066, 1082

(9th Cir. 2006).

The same can be said of the Eleventh Circuit’s opinion in

United States v. Fleet Factors Corp., 901 F.2d 1550 (11th Cir.

1990), which Hearthside heavily relies upon in support of its

view that ownership is measured from the date a recovery

action is filed. In Fleet Factors, the owner at the time the

United States filed its recovery lawsuit was exempt from liability under CERCLA because it was a county government

that had involuntarily acquired the title to the contaminated

property. Id. at 1555 (citing 42 U.S.C. § 9601(20)(A)(iii)).

While the Eleventh Circuit did state that it “construe[s] the

present owner and operator of a facility as that individual or

entity owning or operating the facility at the time the plaintiff

initiated the lawsuit by filing a complaint,” id. at 1554, the

thrust of the court’s analysis was its interpretation of the

phrase “immediately beforehand” in CERCLA’s ownership

definition, as that provision fixes liability when the current

2The district court noted that the only case containing some analysis of

the ownership-measurement issue is Elementis Chemicals, Inc. v. T H

Agriculture & Nutrition, L.L.C., 373 F. Supp. 2d 257 (S.D.N.Y. 2005).

The Elementis court, unlike the other cases cited by the parties, did identify and analyze the issue here presented. Nonetheless, as with the other

cases, that discussion was not necessary or germane to the holding because

the issue of ownership was not disputed. See id. at 267-69. 

CALIFORNIA v. HEARTHSIDE RESIDENTIAL 10557
owner is a state or local government immune from cleanup

liability, id. at 1555. Thus, because the county government

could not be held liable, the Eleventh Circuit had no occasion

to decide the question now before us: Which of two potentially responsible parties—one that owned the property when

the recovery claim accrued and the other that owned it when

suit was filed—is the “current owner” under CERCLA?

Instead, the Eleventh Circuit’s statement of law was made

casually, without analysis, and as “a prelude to another legal

issue that command[ed] the panel’s full attention,” and we do

not find the statement persuasive.3See United States v. Johnson, 256 F.3d 895, 915 (9th Cir. 2001) (en banc) (Kozinski,

J., concurring). As with the other cases cited by the parties

that contain a bare rule statement and no supporting analysis,

we do not believe Fleet Factors squarely considered this issue

and we decline to adopt its language. See id.

B

[3] In determining in the first instance when currentownership status is measured under CERCLA, we observe

that the definition of “owner and operator” is silent on the

date from which ownership is measured. See 42 U.S.C.

3We also disagree with Hearthside’s argument that Congress necessarily

“approved” of the ownership-measurement language in Fleet Factors

when it amended CERCLA in response to the Fleet Factors holding

regarding the liability of property managers. See Monarch Tile, Inc. v. City

of Florence, 212 F.3d 1219, 1221 n.2 (11th Cir. 2000) (discussing the reason for the CERCLA amendment). We have been directed to no part of

the legislative history of the 1996 amendments indicating congressional

approval of Fleet Factors’s “lawsuit filing” language, and our independent

review reveals none. See CERCLA Lender and Fiduciary Liability Limitations Amendments, Pub. L. 104-208 § 2502(a)-(b), 110 Stat. 3009-462 to

-467 (amending 42 U.S.C. §§ 9601, 9607 with the limited scope of providing protections to certain fiduciaries and managers). Therefore, “those

who use legislative history to help discern congressional intent will see the

history here as silent, hence a neutral factor, that simply confirms the obvious, namely, that Congress did not consider the issue.” See Small v. United

States, 544 U.S. 385, 393 (2005).

10558 CALIFORNIA v. HEARTHSIDE RESIDENTIAL
§ 9601(20). Because the plain text of the statute does not

admit of a clear answer to this dispute, we look to the statutory context and CERCLA’s purposes to determine how Congress intended ownership to be measured.4

See, e.g., Carson

Harbor Vill., 270 F.3d at 880 (describing CERCLA as a complex regulatory regime that requires us to “examine the statute

as a whole, including its purpose and various provisions”).

[4] Considering first the broader context of CERCLA liability, we conclude that the Department’s view that ownership

is measured at the time of cleanup best aligns with CERCLA’s statute of limitations. The parties agree, as they must,

that the applicable statute of limitations for a cost-recovery

action is triggered (1) at the completion of a “removal” action,

or (2) at the initiation of an on-site “remedial” action.5 42

U.S.C. § 9613(g)(2). Because statutes of limitations are

intended in part to protect defendants, it is reasonable to

assume that Congress meant the statute of limitations to run

against (and protect) the owner of the property at the time

cleanup occurs. See, e.g., United States v. Hagege, 437 F.3d

943, 955 (9th Cir. 2006) (statutes of limitations ensure “that

the defendant is given the protections of predictability and

promptness”). If Hearthside’s argument were adopted as law,

then an owner could sell a recently cleaned piece of property

to an innocent owner one day before the statute of limitations

runs, with the result that the new owner would bear full

cleanup liability under CERCLA if a recovery action was

later timely filed. Such an unwise and untoward result would

4As we have previously observed, the direct evidence of CERCLA’s

legislative history includes “few truly relevant documents,” perhaps

because of the last-minute compromise that resulted in a “hastily assembled” final bill. Carson Harbor Vill., 270 F.3d at 885 & nn.13-14. Thus,

we will look to the statutory scheme and the purposes animating CERCLA

to determine congressional intent. 

5Although these events trigger the statute of limitations, a remediator

need not wait until removal is complete or remediation is initiated to file

suit. A CERCLA recovery action accrues “at any time after [recovery]

costs have been incurred.” 42 U.S.C. § 9613(g)(2). 

CALIFORNIA v. HEARTHSIDE RESIDENTIAL 10559
undermine the general aim of statutes of limitations to provide

notice and predictability to a defendant and to ensure that the

defendant is in possession of the evidence needed to defend

against the claim. See In re Hanford Nuclear Reservation

Litig., 534 F.3d 986, 1009 (9th Cir. 2008) (“Statutes of limitations are intended to provide notice to defendants of a claim

before the underlying evidence becomes stale.”). We conclude that Congress’s decision to activate the statute of limitations at the time of cleanup is strong contextual evidence that

Congress intended the owner at the time of cleanup to be the

“current owner” in a subsequent recovery suit.

[5] An analysis of CERCLA’s purposes yields the same

conclusion—that current ownership is measured at the time of

cleanup. First, CERCLA encourages responsible parties to

remediate hazardous facilities without delay. Burlington N. &

Santa Fe Ry. Co., 129 S. Ct. at 1874; Fireman’s Fund Ins.

Co., 302 F.3d at 947 (“A fundamental purpose and objective

of CERCLA is to encourage the timely cleanup of hazardous

waste sites.”). This policy weighs in favor of the Department’s position because a landowner that knows it will ultimately be responsible for the cleanup costs has no incentive

to delay the completion of that process once it has begun.

Conversely, under the view of liability urged by Hearthside,

a landowner seeking to avoid liability by transferring the

property before a lawsuit is filed has every incentive to delay

completing the cleanup process until it has found a buyer; the

recovery suit is likely to be filed once cleanup is complete and

the total cost is known. See generally Anthony R. Chase &

John Mixon, CERCLA: Convey to a Pauper and Avoid Cost

Recovery Under Section 107(A)(1)?, 33 Envtl. L. 293, 301-06

(2003) (hypothesizing a scenario in which “an owner may

avoid cost-recovery liability by conveying the site to a willing

pauper after learning about contamination, but before becoming specifically and personally obligated for cost recovery”).

Any contrived delay that an owner might employ to find a

buyer before the recovery lawsuit is filed would contravene

CERCLA’s purpose of efficient cleanup, and this consider10560 CALIFORNIA v. HEARTHSIDE RESIDENTIAL
ation favors the Department’s view that ownership is determined when cleanup costs are incurred and not when the

recovery suit is filed.

[6] Another important purpose of CERLCA is to encourage early settlement between potentially responsible parties

and environmental regulators. See, e.g., Carson Harbor Vill.,

270 F.3d at 880, 884 (discussing CERLCA’s policies of “encouraging early settlement” and promoting the “expeditious

and efficient cleanup of hazardous waste sites”); Fireman’s

Fund Ins. Co., 302 F.3d at 948 (approvingly discussing “early

settlement” under CERCLA, which allows “energy and

resources to be directed at site cleanup rather than protracted

litigation”). The importance of settlement within the CERCLA scheme undercuts Hearthside’s argument for two reasons. First, measuring ownership from the date that the

recovery lawsuit is filed requires that a recovery lawsuit be

filed. A rule that produces a lawsuit in every case is the opposite outcome that CERCLA seeks to promote. Second, one of

the most critical elements of a CERCLA settlement is the

agreed remedial action plan that the responsible party agrees

to undertake. See Alfred R. Light, CERCLA Law and Procedure 211 (1991). Because the owner at the time of cleanup

can help determine the scope of the cleanup and select from

among the reasonably effective remedial alternatives, id., it

follows that the same owner should be responsible for the cost

of the remediation program that it had the opportunity to

influence. CERCLA seeks to include property owners in the

technical consulting process, and this policy is best served by

a rule that sets current ownership at the time cleanup occurs.

[7] Hearthside contends that the lawsuit-filing date would

establish a simple and clear date from which to measure.

Hearthside urges that measuring ownership from the time of

cleanup would require factual determinations about when

cleanup commenced, when cleanup was completed, and when

enough response costs were incurred so as to give rise to a

recovery cause of action. We agree that in some cases factual

CALIFORNIA v. HEARTHSIDE RESIDENTIAL 10561
determinations may be necessary to determine current ownership.6

 Nonetheless, we are not persuaded that the limited factfinding required to determine when a recovery action accrued

is burdensome enough to require a different outcome. As we

previously noted, a CERCLA recovery action accrues at the

point that recovery costs are incurred, and the statute of limitations runs from the time a removal action is completed or

a remedial action is begun on the site. 42 U.S.C. § 9613(g)(2).

Thus, factual questions surrounding the relevant cleanup dates

are a routine and familiar component of CERCLA actions,

and courts are well equipped to resolve such factual questions

without great difficulty. Given that CERCLA’s policies promoting settlement and efficient cleanup support the Department’s position, we are not persuaded that the possible

necessity of determining the accrual date is sufficient to tip

the balance in favor of Hearthside’s preferred construction.

We hold that current ownership for purposes of liability under

42 U.S.C. § 9607(a)(1) is measured from the time the recovery action accrues. Because there is no dispute that Hearthside

was the owner of the Fieldstone Property at all times relevant

to the remediation of the Residential Site, Hearthside is a current owner under 42 U.S.C. § 9607(a)(1).

III

For the foregoing reasons, we affirm district court’s partial

summary judgment grant and remand for further proceedings

not inconsistent with this opinion.

6No factual determinations are needed to determine current ownership

in this case. Hearthside owned the Fieldstone Property at the time the

Department requested remediation of the Residential Site, as well as during the entire cleanup of the Residential Site by the Department. Therefore, there is no question that Hearthside was the current owner of the

Fieldstone Property at the time the Residential Site was remediated. We

express no view, of course, on the remaining questions about whether the

Fieldstone Property actually leaked contaminants onto the Residential Site

or whether other responsible parties, as defined by 42 U.S.C. § 9607(a),

may be liable for cleanup costs. 

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AFFIRMED AND REMANDED.

CALIFORNIA v. HEARTHSIDE RESIDENTIAL 10563