United States Court of Appeals

FOR THE EIGHTH CIRCUIT

 ___________

 No. 05-3147

 ___________

United States of America, *

*

Plaintiff/Appellee, *

*

Arkansas Department of Pollution *

Control and Ecology, *

*

Plaintiff, *

*

v. *

*

Vertac Chemical Corporation, * Appeals from the United States

* District Court for the

Defendant, * Eastern District of Arkansas.

*

Hercules, Inc., *

*

Defendant/Appellant, *

*

Inter-Ag Corporation; Department of *

Defense; Dow Chemical Corporation; *

Velsicol Chemical Corporation; John *

Does, 1-5; Chemtura Corporation, *

formerly known as Crompton Co., *

formerly known as CIE, formerly *

known as Uniroyal Chemical Limited, *

*

Defendants, *

*

John Doull, Ph.D., M.D.; Karl K. *

Rozman, Ph.D.; William J. Waddell, *

M.D.; K. Roger Hornbrook, Ph.D.; *
-2-

Daniel M. Byrd, III, Ph.D., D.A.B.T.; *

Robert Golden, Ph.D.; B. Frank Vincent,*

Ph.D.; American Council on Science *

and Health, *

*

Amici on behalf of *

Appellant. *

 ___________

 No. 05-3153

 ___________

United States of America, *

*

Plaintiff/Appellee, *

*

Arkansas Department of Pollution *

Control and Ecology, *

*

Plaintiff, *

*

v. *

*

Vertac Chemical Corporation; *

Hercules, Inc.; Inter-Ag Corporation; *

Department of Defense; Dow Chemical *

Corporation; Velsicol Chemical *

Corporation; John Does, 1-5; *

*

Defendants, *

*

Crompton Co./CIE, *

*

Defendant/Appellant. *

___________
1

As of January 30, 2001, Uniroyal Chemical Limited changed its name to

Crompton Co./Cie. For consistency, we will use Uniroyal throughout this opinion.

2

The Honorable George Howard, Jr., United States District Judge for the

Eastern District of Arkansas.

-3-

Submitted: March 13, 2006

Filed: July 13, 2006

___________

Before WOLLMAN, FAGG, and RILEY, Circuit Judges.

___________

WOLLMAN, Circuit Judge.

Hercules, Inc. (Hercules) and Crompton Co./Cie (Uniroyal)1

 raise constitutional

claims and argue that the district court2

 erred in assigning and apportioning liability

for environmental cleanup costs pursuant to the Comprehensive Environmental

Response, Compensation and Liability Act (CERCLA), 42 U.S.C. §§ 9601-0675, as

amended by the Superfund Amendments and Reauthorization Act of 1986 (SARA),

Pub. L. No. 99-499, 11 Stat. 1613. We affirm. 

 

I. BACKGROUND

This case involves twenty-six years of litigation and numerous district court and

appellate opinions, both published and unpublished. At issue is the cost the United

States has incurred in its environmental cleanup efforts at the Vertac Chemical Plant

site in Jacksonville, Arkansas (the Jacksonville site or the site). The full procedural

and factual history of this case has been discussed in several previous decisions. This

opinion will address the relevant portions of each. 

 

A. Factual History
-4-

The Jacksonville site was originally developed by the federal government in the

1930s as a munitions factory. In the late 1940s, the site was sold to Reasor-Hill

Corporation (Reasor-Hill), a now-defunct company. Reasor-Hill first manufactured

various pesticides, but began manufacturing phenoxy herbicides in 1958. These

herbicides included dichlorophenoxyacetic acid (2,4-D) and trichlorophenoxyacetic

acid (2,4,5-T), synthetic hormones that kill weeds or brush by accelerating growth to

the point of natural death. Although these herbicides biodegrade into harmless

substances, the manufacture of 2,4,5-T (but not 2,4-D) creates a toxic byproduct that

is now viewed as hazardous to humans, 2,3,7,8-tetrachlorodibenzo-p-dioxin (dioxin).

While Reasor-Hill operated the site, an unknown quantity of these and other untreated

chemical wastes from the production processes flowed through cooling ponds on the

west side of the plant into a nearby stream, Rocky Branch Creek. Other wastes were

stored in drums stacked in a field on the site.

In 1961, Hercules bought the site and continued to manufacture herbicides,

including 2,4-D and 2,4,5-T, at the plant until 1970. During this period, Hercules sold

the bulk of its product to the United States Department of Defense as the defoliant

Agent Orange, a herbicide made from a mixture of 2,4-D and 2,4,5-T that was used

in Vietnam to clear jungle undergrowth. 

Soon after Hercules took over the site, it buried the deteriorating drums left by

Reasor-Hill in unlined trenches in the southeast corner of the site. Until late 1964,

Hercules continued Reasor-Hill’s practice of discharging untreated waste water

directly into Rocky Branch Creek. Hercules then constructed a waste water

pretreatment system, but the system did not remove dioxin. It consisted of a

neutralization trench designed to reduce the acidity of the water, an equalization basin

designed to stabilize the rate of flow into the City of Jacksonville’s sewage system,

and a pump and pipe to deliver the treated water to the sewage system. The system’s

equalization basin frequently overflowed during heavy rainfalls, and it leaked. 
3

Transvaal reorganized as Vertac in 1976. In this opinion, we will refer to both

corporations as Vertac.

-5-

After it learned of the toxicity of dioxin in 1965, Hercules instituted a toluene

extraction process designed to remove organic impurities from 2,4,5-T products. This

process yielded residue (stillbottoms) containing extremely high levels of dioxin.

Hercules placed this residue in drums, some of which it buried at the site and some of

which it disposed of at a nearby landfill. Hercules acknowledges that numerous leaks

and spills occurred during its operation of the site. When the drums leaked in the

process area before being transported to the drum burial pit, Hercules’s practice was

to place any contaminated soil into the drum. 

In 1970, Hercules ceased production at the site. Hercules cleaned out all of its

equipment and production vessels, buried its waste, and shipped empty drums off-site.

In 1971, it leased the facility to Transvaal, Inc., which later became Vertac Chemical

Corp. (Vertac).3

 

Vertac continued to manufacture 2,4-D and 2,4,5-T and followed Hercules’s

practice of burying most of the waste. In 1975, however, Vertac began shipping its

2,4-D waste to off-site landfills and began to store its 2,4,5-T stillbottoms above

ground with the hope that the waste would someday be recycled. In 1976, Vertac

purchased the site from Hercules. Vertac voluntarily ceased manufacturing 2,4,5-T

and 2,4,5-TP on March 15, 1979.

On February 26, 1980, the United States Environmental Protection Agency

(EPA) issued a proposed rule under the Toxic Substances Control Act to prevent

Vertac from disposing of the dioxin from the Jacksonville site. This rule, known as

the Vertac Rule, became final later that year and prohibited the off-site disposal of

2,4-D wastes that contained dioxin. If Vertac could show that a batch of 2,4-D
-6-

produced waste that was free of dioxins, it could dispose of that waste and all

subsequent 2,4-D waste off-site. 

According to testimony at the hearing on the proposed rule, Vertac had

approximately 3200 drums of wastes resulting from the production of 2,4-D. The first

set of samples taken from seven hundred drums of waste resulting from the initial

production of 2,4-D revealed dioxin levels of approximately twenty parts per billion

(ppb). The samples were later sent to Wright State University and Monsanto

Company for testing. Monsanto could not detect any dioxin with its analytical

equipment, but Wright State detected .7 ppb. In a second sampling of 1000 drums,

it detected .5 ppb and the next sampling showed .3 ppb. Because the 2,4-D waste

contained dioxin, Vertac stopped analyzing samples of the waste and allowed the

drums to accumulate. Later testing by the State of Arkansas, as well as the results of

trial burns, revealed the presence of dioxin in the drums. 

Vertac continued its operations until 1986. In 1987, it abandoned the site, and

the site went into receivership. By then, there were nearly 29,000 drums at the site

that contained waste materials including 2,4-D, 2,4,5-T, and dioxin. Some drums

were labeled T waste, some D waste, some were marked T and D, and some were not

marked at all. Many of these markings were indistinguishable or unreadable. More

than 15,000 drums were stored outside and exposed to the elements. The drums were

stacked three high on deteriorating pallets and were failing at a rate of between five

to three hundred drums per week. 

Many of the drums had corroded and leaked, contaminating the soil,

groundwater, and buildings at the site. Contamination was found in other areas of the

site, at the landfills, in nearby neighborhoods, and in the grounds adjacent to the site.

After Vertac abandoned the plant, the EPA took over the site, closed down all

operations, and assumed cleanup responsibilities that have cost well over $110 million

to date. 
-7-

To carry out its response measures, the EPA divided the site into five units: offsite areas, operable units 1, 2, and 3, and the incineration response action. Several

removal actions addressed the immediate threat posed by the drummed waste left on

the site when it was abandoned. Four remedial actions addressed the long term

solutions for the rest of the site and the surrounding area affected by the site. For each

of the remedial actions, the National Contingency Plan required the EPA to (1)

conduct a remedial investigation of the site conditions, including an endangerment

assessment of the threats posed by the contamination at the site; (2) perform a

feasibility study examining the various technical alternatives for remediating the site;

(3) take public comment on the EPA’s proposed remedial action plan based on the

alternatives discussed in the feasibility study; (4) compile an administrative record for

remedial action decision making; and (5) issue a written record of decision (ROD)

explaining the Regional Administrator’s reasoning in selecting the final remedial

action plan and responding to the public comments received. 

Uniroyal was one of Vertac’s customers and purchased 2,4,5-T and other

products from Vertac in the 1970s. In 1978, Vertac informed Uniroyal that it lacked

the funds to purchase enough 1,2,4,5-tetrachlorobenzene (TCB), a key ingredient in

the manufacture of 2,4,5-T, to fulfill its contractual obligations to Uniroyal. Uniroyal

agreed to supply Vertac with enough TCB to create some 1.3 million pounds of 2,4,5-

T that was to be shipped back to Uniroyal. Vertac did not purchase the TCB directly

from Uniroyal, but instead reduced the amount it charged Uniroyal for the 2,4,5-T to

reflect the value of the TCB that Uniroyal had supplied. This arrangement was

embodied in two separate contracts and was carried out between March 1978 and

March 1979. The 2,4,5-T that was produced with Uniroyal’s TCB represents less than

one percent of the more than 150 million pounds of 2,4-D and 2,4,5-T that were

manufactured at the site over the course of its operation.
4

Litigation began in 1980. For a description of the early procedural history, see

United States v. Hercules, Inc., 247 F.3d 706 (8th Cir. 2001) and United States v.

Vertac Chem. Corp., 966 F. Supp. 1491 (E.D. Ark. 1997). 

5

In its most recent opinion, the district court noted an inconsistency in our April

11, 2001, opinion. In that opinion, we meant to vacate: (1) the unpublished opinion

issued on October 12, 1993, and (2) the denial of the motion to reconsider issued on

November 1, 1993. 

-8-

B. Procedural History4

On October 12, 1993, the district court granted the government’s motion for

summary judgment, holding that Hercules was jointly and severally liable under

CERCLA sections 107(a)(2) and (3) for the response costs incurred by the United

States with regard to the Jacksonville site. 42 U.S.C. § 9607(a)(2) and (3); United

States v. Vertac Chem. Corp., 841 F. Supp. 884 (E.D. Ark. 1993). Hercules moved

for reconsideration, arguing that disputed issues of fact existed regarding divisibility.

On November 1, 1993, the district court denied Hercules’s motion, finding that

Hercules had failed to present evidence in support of its divisibility of harm defense.

Hercules appealed that decision, and we reversed and remanded the case to the

district court to reconsider Hercules’s claim of divisibility in light of the legal

standards enunciated in our April 11, 2001, opinion.5

 United States v. Hercules, Inc.,

247 F.3d 706 (8th Cir. 2001) (Vertac XI). In October and December 2001, the district

court held an evidentiary hearing on Hercules’s divisibility of harm defense, resulting

in a transcript of some 2300 pages in length. The parties submitted post-hearing

briefs, together with a voluminous record that included documents, exhibits,

transcripts, depositions, and the administrative record. The district court considered

the entire record, applied the law as stated in Vertac XI, and held that Hercules had

failed to establish its divisibility of harm defense, with the exception of one off-site

landfill, the Rogers Road landfill (a divisibility finding that the government does not
-9-

challenge). United States v. Vertac Chem. Corp., 364 F. Supp. 2d 941 (E.D. Ark.

2005) (Vertac XII). 

In its final judgment following its March 30, 2005, memorandum opinion and

order, the district court held that Hercules and Uniroyal were jointly and severally

liable to the United States for the following amounts: (1) Hercules, in the amount of

$119,318,504, plus any additional response costs, and (2) Uniroyal, in the amount of

$110,410,161, plus any additional costs. The district court had previously allocated

the amount of contribution of the total response costs for which each entity was jointly

and severally liable. To the extent that the United States enforces its judgment,

Hercules is entitled to contribution from Uniroyal in an amount equal to 2.6 percent

of $110,410,161, and Uniroyal is entitled to contribution from Hercules in an amount

equal to 97.4 percent of $110,410,161. 

On appeal, Hercules argues that the district court erred in apportioning liability.

Uniroyal argues that we should overturn our holding in Vertac XI that affirmed the

district court’s holding that Uniroyal was liable. Hercules and Uniroyal further argue

that the district court’s imposition of retroactive liability was unconstitutional. 

II. HERCULES’S LIABILITY

Hercules challenges the district court’s liability determination on both legal and

factual grounds. We will first address Hercules’s contention that the district court

applied the wrong legal standard in determining whether Hercules established its

divisibility of harm defense. We will then turn to Hercules’s argument that the

drummed waste, the stillbottoms, Operable Unit 1 (OU-1), the Jacksonville Landfill,

the soils, and the groundwater are each separate sites capable of further

apportionment. 
-10-

We review de novo the district court’s legal conclusions. Richardson v. Sugg,

448 F.3d 1046, 1052 (8th Cir. 2006). We review its factual findings for clear error.

Id. “Using this standard, we will overturn a factual finding only if it is not supported

by substantial evidence in the record, if it is based on an erroneous view of the law,

or if we are left with the definite and firm conviction that an error was made.” Id. We

give due regard to the district court’s opportunity to judge the credibility of the

witnesses. Id. “A district court’s choice between two permissible views of evidence

cannot be clearly erroneous.” Tadlock v. Powell, 291 F.3d 541, 546 (8th Cir. 2002).

A. Legal Standard

Hercules contends that the district court erred in concluding that the site could

not be separated into divisible geographic units. As to the drums, Hercules argues that

the district court failed to consider whether there existed a single, divisible harm and

addressed only whether there existed distinct harms. The thrust of Hercules’s

arguments is factual, however, and the district court applied the appropriate legal

standard. 

In Vertac XI, we held that a defendant must prove by a preponderance of the

evidence that there exists a reasonable basis for divisibility. Vertac XI, 247 F.3d at

717. 

The proper standard for determining divisibility . . . is that the defendant show

either distinct harms or a reasonable basis for apportioning causation for a

single harm. A defendant need not prove that its waste did not, or could not,

contribute to any of the harm at a CERCLA site in order to establish

divisibility, because it is also possible to prove divisibility of single harms

based on volumetric, chronological or other types of evidence. A site may also

be divisible if a defendant can establish that it consists of non-contiguous areas

of contamination. 
6

We have considered Hercules’s argument concerning the information

contained in one of the government’s exhibits (Exhibit K). Because the district court

expressly stated at the time it granted the government’s motion to withdraw the exhibit

that it would not rely on the exhibit in ruling on Hercules’s divisibility defense, we

conclude that this argument is without merit.

-11-

Id. at 719 (internal quotations and citations omitted). We noted that proving

divisibility is a “very difficult proposition” and that where the harms are incapable of

division, the district court should not make an arbitrary apportionment. Id. at 717. 

In its opinion, the district court applied the standard for determining divisibility

as set forth in Vertac XI. The district court first considered whether Hercules

established a reasonable basis for divisibility by proving by a preponderance of the

evidence that the site could be divisible on a geographical basis.6

 Under its

geographical apportionment theory, Hercules argued that each operable unit within

the Jacksonville site is a separate site for purposes of divisibility. In considering and

ultimately rejecting Hercules’s argument, the district court found that the EPA divided

the site into operable units for the purposes of remediation and that the “operable units

did not solely address geographical portions of the Site.” Vertac XII, 364 F. Supp. 2d

at 951. 

With regard to the drums, Hercules argues that the district court erroneously

held that cross-contamination and commingling of dioxin prevented Hercules from

establishing a reasonable basis for divisibility. In Vertac XI, we held that a single

harm may be treated as divisible when it is possible to discern the degree to which

different parties contributed to the damage. “Single harms may also be treated as

divisible in terms of degree, based, for example on the relative quantities of waste

discharged into the stream. Divisibility of this type may be provable even where

wastes have become cross-contaminated and commingled.” 247 F.3d at 718 (internal

quotations omitted). Hercules, however, did not argue that the drums caused a single,

divisible harm that could be apportioned based on relative quantities of waste or
-12-

volumetric evidence. As the government points out, this argument would have been

inconsistent with Hercules’s argument that it should not be held liable for any of the

drummed waste. 

B. Drummed Waste

The 28,500 drums contained 2,4-D and 2,4,5-T stillbottom wastes, dioxin, and

other hazardous and toxic substances. When the site went into receivership, the drums

were leaking, corroding, and failing. By February 1989, the failed drums had been

placed inside new, larger drums (overpacked). Because the drums contained corrosive

materials, maintenance of the drums was an ongoing process. The EPA determined

that the wastes on the site posed a threat to public health and welfare and the

environment. The drummed material was considered acutely hazardous waste, and

the EPA chose to dispose of the wastes by incineration. The Arkansas Department of

Pollution Control and Ecology (ADPC&E) managed the incineration from 1989 until

June 1993, when the EPA took over the on-site incineration of the drums. 

Hercules argues that the district court clearly erred in finding the following: (1)

the EPA and the ADPC&E decided to incinerate the 2,4-D waste drums because of the

dioxin contained therein; (2) Hercules was responsible for the cross-contamination of

the plant equipment causing 2,4-D waste drums to contain dioxin; and (3) Hercules

was responsible for the commingling of the 2,4-D waste and the dioxin contaminated

soil, causing the drums to contain dioxin. 

Hercules first argues that it should not be held liable for the cost of incinerating

the 2,4-D waste drums because those drums would have been incinerated regardless

of whether they were contaminated with dioxin. The district court concluded that

Hercules’s argument did not “withstand scrutiny” and found that the EPA and

Arkansas were concerned that a potential fire, explosion, or tornado could spread

dioxin into the environment. Vertac XII, 364 F. Supp. 2d at 953. Thus, the district
-13-

court determined that “[i]t was not, as Hercules argues, the dirt in the drums that drove

the incineration; rather it was the dioxin in the dirt that drove the incineration of the

drums.” Id. 

As the district court noted in the factual background of the case, the Vertac Rule

permitted Vertac to landfill the 2,4-D waste drums only after showing that the drums

contained no dioxin. This was never shown, and Phyllis Moore, Ph.D., the former

director of the ADPC&E, and Randall Mathis, her successor, testified (1) that time

was of the essence, (2) that further testing was expensive and time consuming, (3) that

the 2,4-D drums were corroding and failing, and (4) that the drums posed an imminent

risk of fire and explosion. 

Dr. Moore was involved in the initial decision to incinerate the 2,4-D waste

drums. Although she stated that the “issue of dirt” did not influence her decision, Dr.

Moore testified that a primary concern was the presence of dioxin in the 2,4-D waste

drums, regardless of whether it was transmitted to the drums by cross-contamination

at the production facility or by the overpacking of the drums with contaminated soil.

J.A. at 26433-34. She further testified that it was important that the method of

incineration satisfy the requirements of the ADPC&E and the EPA for destruction of

dioxin. Regarding the ultimate decision to incinerate, Dr. Moore testified that the

state “would have looked at other options” if there had been no dioxin in any of the

drums. J.A. at 26445. We thus reject Hercules’s argument that the incineration of the

2,4-D drums was in no way attributable to dioxin. 

Hercules next argues that the district court clearly erred in finding that the

equipment at the plant contaminated 2,4-D waste with dioxin after Hercules had

cleaned the production vessels in 1970. The district court found that “the cleanup of

the equipment was not as thorough as portrayed by Hercules, and that the plant

equipment was cross-contaminated with 2,4-D, 2,4,5-T, and dioxin.” Vertac XII, 364
-14-

F. Supp. 2d at 952. The district court rejected Hercules’s theory that Vertac’s

chemical production flushed the dioxin out of the production vessels.

In its brief, Hercules recites portions of Arthur Treisback’s affidavit, which was

excluded as hearsay at trial and is not part of the record on appeal, and relies primarily

on Treisback’s deposition testimony, portions of which were read into evidence by

Richard Karkkainen during his testimony. Treisback was Hercules’s plant manager

in charge of the 1970 plant cleanup, and Karkkainen was Vertac’s director of

environment and safety from 1979 to 1986. Karkkainen testified that Treisback’s

deposition testimony described the common practice of cleaning plant equipment and,

although Karkkainen had no personal knowledge of the cleaning, that it was likely that

Hercules followed the common practice. J.A. at 26458. Karkkainen further testified

that there was no indication that the cleaning process was successful. J.A. at 26562.

 

The district court also heard the testimony of Reeddie Ray and Stephen

Quigley. Ray worked for Hercules from 1964 to 1970 and was involved in the plant

cleanup. Ray testified extensively about how the equipment was cleaned. To clean

the tanks, “[w]e washed them out with a water hose. . . . Only time we heated the

water if there was sediment in the bottom of the tank.” Regarding the process lines,

“Process lines were cleaned with steam. . . . We had to disassemble the lines to get

water out of the tank.” Ray did not recall using any solvents: “The only time we used

solvent is where we wanted to take the sediment and circulate and dissolve something

in it, but I don’t think we used solvent. I think we just used water and steam, that’s

all.” J.A. at 27522-23. Quigley, Uniroyal’s expert, testified that it was unlikely that

solvents were used to clean the equipment and even if they were, it is likely that some

contamination would remain in the equipment. J.A. at 28089-90. Given the evidence

before the district court, we conclude that it did not err in finding that dioxin remained

in the plant after Hercules’s 1970 cleaning. 
7

Hercules argues that the government’s attorney made a judicial admission

supporting Hercules’s flushing theory. Having reviewed the record, we conclude that

the statements in question did not rise to the level of a binding judicial admission.

-15-

Hercules contends that the district court clearly erred in rejecting its flushing

theory. According to this theory, after Vertac shifted plant production exclusively to

products that do not generate dioxin, about ten production runs would have flushed

out any significant amount of dioxin remaining in the plant equipment. Because

Vertac stopped producing 2,4,5-T in March 1979, three years after Hercules sold the

plant to Vertac, Hercules argued that there could be no detectable dioxin in the 2,4-D

waste in late 1979, when Vertac began to accumulate the 2,4-D waste drums. The

district court disregarded the flushing theory as, “just that–a theory” and noted that

“[a]fter nearly eight years of only 2,4-D production, dioxin and 2,4,5-T were present

in plant equipment.” Vertac XII, 364 F. Supp. 2d at 952. 

We conclude that the district court did not err in rejecting Hercules’s flushing

theory.7

 The district court stated that, because the plant equipment contained dioxin

and 2,4,5-T after nearly eight years of 2,4-D production, “the evidence basically

disproves the theory.” The finding that dioxin was present in the plant equipment is

supported by the evidence. An EPA inventory of the process vessels and tanks in the

central process area of the Jacksonville site showed that 140 of the 213 process vessels

contained chemical material including 2,4-D, 2,4,5-T, and dioxin. J.A. at 19779-80.

Of the ninety-six vessels sampled, more than half were contaminated with dioxin at

levels greater than 0.3 ppb. J.A. at 19780. Hercules argues that the data showing

contamination of the plant equipment was untrustworthy, but Hercules has failed to

show that the EPA or the district court relied on that evidence. Hercules’s expert

witness, Randal Maud, Ph.D., served as the project manager for Hercules at the

Jacksonville site to assess the environmental consequences of the site. He testified

that the unreliable data, “would likely not be used because of the quality assurance

problems.” J.A. at 28256. 
-16-

Finally, with regard to the drummed waste, Hercules argues that the district

court erred in holding Hercules liable for the waste that was placed in the drums

during overpacking. Hercules contends that either the placement of the dioxincontaminated soil into the 2,4-D drums constituted a second disposal under CERCLA,

for which it is not liable, or that the overpacking by Vertac or the EPA constituted a

superseding cause, thereby relieving Hercules of liability. Hercules does not dispute,

however, that it contaminated the soil with dioxin at the Jacksonville site. 

As the district court recited in its decision, disposal under CERCLA is defined

as the “discharge, deposit, injection, dumping, spilling, leaking, or placing of any solid

waste or hazardous waste into or on any land or water so that such . . . waste . . . may

enter the environment.” 42 U.S.C. §§ 6903(3), 9601(29). Hercules caused dioxin to

enter the environment, thereby disposing of the waste. That Vertac and the EPA

overpacked leaking drums in an effort to contain the further contamination of the site

does not absolve Hercules of CERCLA liability. Accordingly, Hercules remains

responsible for the ongoing contamination caused by the dioxin, for that

contamination was not solely caused by the act of a third party.

C. Stillbottoms

Hercules argues that the stillbottom waste was not disposed of until after

Hercules sold the plant and that thus it is not responsible for any of the costs related

to that disposal. Vertac began accumulating 2,4,5-T stillbottom drums on-site in

1975, and it bought the plant from Hercules in 1976. Hercules claims that Vertac

merely stored the waste for the purpose of later recycling, and thus did not dispose of

the waste until 1979, when the registration for 2,4,5-T was suspended. Accordingly,

Hercules claims that the 2,4,5-T stillbottom drums constituted a distinct harm and that

it should not be liable for their incineration.
-17-

Section 103(a) of CERCLA holds liable “any person who at the time of disposal

of any hazardous substance owned or operated any facility at which such hazardous

substances were disposed of.” 42 U.S.C. § 9607(a)(2). The term “facility” includes,

“any site or area where a hazardous substance has been deposited, stored, disposed of,

or placed.” 42 U.S.C. § 9601(9). Finally, as we recounted above, disposal includes

placing hazardous waste in a manner that allows the waste to enter the environment.

Simply stated, the district court found that Hercules owned a facility at which

hazardous waste was allowed to enter the environment. Specifically, it found that the

stillbottoms leaked onto the ground when Hercules owned the plant. This finding is

supported by Quigley’s expert testimony: “[W]hen the wastes [stillbottoms] were put

into drums for disposal, they were put into recycle drums, . . . and those recycle drums

did leak, some of them instantaneously upon having the waste put in them, and other

times shortly after the waste being put in them.” J.A. at 28082. Robert Fischer, a

chemist with Hercules and Vertac, also testified that the deterioration of the T drums

was one of the major sources of dioxin contamination at the site. J.A. at 27060. In

light of this testimony, we conclude that the district court did not clearly err in holding

Hercules liable for the incineration of the stillbottoms. 

D. Operable Unit 1

OU-1 consisted of the above-ground media, including the process vessels (e.g.

the storage tanks, chemical reaction vessels) in the central process area. The ROD for

OU-1 required that plant equipment be dismantled and salvaged to the extent possible

and that all other nonsalvageable material be placed in an on-site landfill. Any

hazardous material not suitable for the landfill was to be incinerated. Hercules

implemented the remedy pursuant to Unilateral Administrative Order (UAO) issued

by the EPA. 

Hercules argues that the district court erred in holding it liable for the cleanup

of OU-1, including the demolition, removal, and disposal of plant buildings and
8

Hercules accepted responsibility for the spent carbon wastes it generated.

-18-

equipment, and their process waste contents. Hercules admits liability for part of the

OU-1.8

 It contends that it established a reasonable basis of divisibility for further

apportioning liability. Hercules argues that the district court erred in finding (1) that

the plant buildings were demolished because they contained dioxin, (2) that Hercules

was responsible for the contamination of the equipment, the shredded trash, and the

pallets, and (3) that the EPA’s response action was not arbitrary or capricious. 

The district court found that “[t]he buildings were demolished because the risk

of collapse might cause release and human exposure to herbicide process

contamination, including unacceptable levels of TCDD [dioxin].” We conclude that

the record adequately supports this finding. Maud testified that the EPA was

concerned about the buildings because they were falling into disrepair and because

“they contained large amounts of asbestos siding and roofing and asbestos interiors,

some of which also contained dioxin dust.” J.A. at 28265. The ROD states that in the

event of a catastrophe, “Based on the 2,3,7,8-TCDD (dioxin) concentrations found in

[OU-1], human exposure to concentrations in excess of those considered acceptable

. . . could occur.” J.A. at 19811.

 

Hercules further contends that the district court clearly erred in finding that

Hercules was responsible for the contamination of the plant equipment. In his expert

testimony, Eugene Meyer, Ph.D., affirmed the statement from his 1998 affidavit that

“[t]he presence of 2,3,7,8-TCDD [dioxin] was established through samples in all of

the following: surface and subsurface materials collected from the site sewers,

distillation bottoms, waste activated carbons, leachate from on-site buildings, trash,

shredded pallets, and the sludges generated during the treatment of waste waters.”

J.A. at 27928. Although Hercules’s project manager for EPA compliance, Douglas

Keilman, opined that Hercules did not cause the contamination, his opinion was based
-19-

on the flushing theory. For the reasons stated above, we again conclude that the

district court did not clearly err in rejecting that theory. 

The district court found that “Hercules cannot establish that it was not the

source of the contamination on the shredded trash and pallets.” Vertac XII, 364 F.

Supp. 2d at 955. The shredded trash included things like hard hats, broken tools, and

tyvex suits, and the pallets were used to store drummed waste at the site. Although

Keilman testified that the trash had been accumulating since 1980, there was no

evidence to show that Vertac, and not Hercules, caused the contamination of the trash.

The district court found that the pallets were contaminated by both leaking drums and

contaminated soil. Because Hercules is responsible for the contaminated soil, the

district court did not err in further holding it responsible for the pallets. 

Finally, Hercules argues that the EPA’s issuance of a UAO requiring Hercules

to dismantle and to landfill the equipment and buildings at the site was arbitrary and

capricious. We disagree. Section 113(j) of CERCLA allows a defendant to avoid

paying response costs to the extent that it can show that the response action was

arbitrary and capricious. 42 U.S.C. § 9613(j). Hercules does not argue that the

disposal of the building and equipment is arbitrary and capricious, but rather that the

EPA was arbitrary and capricious in issuing a UAO. To support the issuance of a

UAO, there must be evidence that there “may be an imminent and substantial

endangerment to the public health or welfare or the environment because of an actual

or threatened release of a hazardous substance from a facility.” 42 U.S.C. § 9606(a)

(emphasis added). Because the record contains sufficient evidence to support the

EPA’s determination that the cautionary “may be” threat of imminent substantial

endangerment had been established, its decision to issue the UAO was not arbitrary

and capricious. 
-20-

E. Jacksonville Landfill

The district court found that Hercules disposed of hazardous wastes at the

Jacksonville Landfill and held Hercules liable for the cleanup costs associated with

the landfill. In its investigation, the EPA found rusting drums and piles of “white

fibrous, absorbent-type materials” at the Jacksonville Landfill. Tests confirmed the

presence of dioxin, 2,4,5-T, and other chemicals associated with the Jacksonville site.

In its ROD, the EPA called for the excavation of contaminated soils, the replacement

and capping of the excavated areas with clean soil, and the cleaning and removal of

large refuse items. The contaminated soil and drums were incinerated at the site.

Although Hercules admits that it took some nonhazardous waste to the Jacksonville

Landfill, it argues that the district court clearly erred in finding that Hercules disposed

of hazardous wastes at the Jacksonville Landfill, and it contends that the EPA’s

response was arbitrary and capricious.

We conclude that the district court’s finding is supported by substantial

evidence. Indeed, the district court cited the testimony by four Hercules employees

that they took chemical wastes to the Jacksonville Landfill. Billy Honey worked

maintenance at the plant from the time Hercules bought it until it closed. J.A. at

26291. He testified that he hauled drums filled with chemical waste to the

Jacksonville Landfill. J.A. at 26299-300. Doyce Shurley worked for Hercules in the

early 1960s, and he recalled taking a barrel of stillbottoms to the landfill. Vincent

Dodson worked for Hercules in the late 1960s, and he testified that chemical wastes

were disposed of at the landfill. When asked what type of waste was taken to the

Jacksonville landfill, Leroy Jordan replied, “We took [waste] from each trash pick-up

point. We took it from every rig and barrels. We cleaned out the incinerator and

carried that stuff over there. Anything that they needed to get rid of, and that included

benzen barrels, trash from the lunchroom, barrels of goop, acid, anything and

everything.” J.A. at 26352. 
-21-

Hercules argues that this testimony should be discredited because it presented

contradictory evidence to counter it. The short answer to this contention is to note

once again that a district court’s choice between two permissible views of the

evidence is no basis for a conclusion that its factual finding is clearly erroneous.

Tadlock, 291 F.3d at 546.

 

Hercules contends that the EPA’s response to the Jacksonville landfill was

inappropriate for the following reasons: (1) the cancer potency factor used by the EPA

in its risk assessment constitutes a rule under the Administrative Procedures Act

(APA) that must be overturned because it was not subject to notice and comment, and

(2) the EPA’s exposure assumptions were arbitrary and capricious. We disagree.

The cancer potency factor was used to calculate the risk and to set dioxin

cleanup standards for the soil and sediments at the Jacksonville site. To determine

whether a statement by an agency is a legislative rule or policy, we apply the two-part

test of McLouth Steel Prod. Corp. v. Thomas, 838 F.2d 1317, 1320 (D.C. Cir. 1988).

A policy statement (1) does not have a binding effect; it does not impose any rights

and obligation; and (2) a policy “genuinely leaves the agency and its decisionmakers

free to exercise discretion.” Id. (internal quotations omitted). The district court

concluded that the “Health Assessment Document which set forth the cancer potency

factor does not impose any rights [or] obligations. It is at most only a technical and

advisory report. It did not obligate the agency or public in determining acceptable

risks associated with dioxin.” United States v. Vertac Chem. Corp., 33 F. Supp. 2d

769, 779 (E.D. Ark. 1998) (Vertac IX). 

This finding is adequately supported by the record. As the district court noted,

the EPA Regional Administrator considered the lower figure proposed by Hercules’s

contractor, ChemRisk, and rejected it. Indeed, in the ROD for the Jacksonville

landfill, the EPA addressed why ChemRisk’s calculations would not be used,

“Hercules Inc. submitted a report prepared by ChemRisk which provided calculations
-22-

resulting in cleanup goals differing from EPA’s for dioxin. The report utilized certain

calculations and assumptions which were contrary to EPA guidance and resulted in

cleanup goals much less restrictive than those calculated by the EPA.” J.A. at 16407.

The document goes on to discuss the discrepancies between the EPA’s and

ChemRisk’s methods of calculating site related risks and to explain that the EPA

rejected ChemRisks proposal because “ChemRisk’s proposed cleanup goals, using

EPA’s risk assessment approach, would not result in excess cancer risks (after

remediation) within the acceptable risk range.” J.A. at 16408. The EPA considered

Hercules’s comments on the EPA’s application of the cancer potency factor with

regard to the cleanup levels at the site and responded to the comments in the final

RODs. 

Hercules argues that the exposure assessments used by the EPA were arbitrary

and capricious and did not justify the remedial order. Having considered the ROD and

related evidence, we conclude that this argument is without merit. 

 

F. Soils and Groundwater

The revised ROD for Operable Unit 2 (OU-2) addressed contaminated on-site

soils, foundations, and underground utilities and off-site soils and sediments that had

been excavated from off-site areas and stored on the site. The remedy selected

required the excavation of dioxin contaminated soil, and the disposal of this soil in an

on-site containment vault. The ROD for Operable Unit 3 (OU-3) dealt with

groundwater contamination under the site. It states that “groundwater contamination

at the site is complex, resulting from past waste management and disposal practices.

Sources of contamination include on-site landfills, spills and discharges into the

central ditch, Reasor Hill well, and other parts of the central process area.” J.A. at

20136.
-23-

Hercules argues that the soil and groundwater contamination were divisible as

successive harms based on the relative production volumes of 2,4,5-T and 2,4,5-TP

attributable to Hercules from 1961 until it sold the plant in 1976 and to Vertac from

that point until it ceased production of 2,4,5-T in 1979. Based on the estimated

production figures, Keilman determined that Hercules was responsible for 70.74% of

the EPA’s response costs. J.A. at 27177. To reach this figure, Hercules relied on the

following assumptions and evidence: (1) Hercules assumed that leaks and spills took

place at roughly the same frequency and severity during the plant’s production of

2,4,5-T and 2,4,5-TP; (2) Keilman testified that prior to 1965, most of the dioxin left

the plant with the product; (3) Hercules offered evidence that the half-life of dioxin

in soil is approximately twelve years, though it ranged from a few days to decades;

and (4) Hercules touted its housekeeping and maintenance practices as being far

superior to those of Vertac. 

The district court determined that this evidence was not sufficiently concrete

and specific to apportion the harm. Most importantly, there was no evidentiary basis

for Hercules’s assumption that the release of wastes at the site was related to

production volumes, nor was there any testimony that there was any reasonably

constant ratio or direct correlation between the releases of dioxin and production of

dioxin generating products. As the district court pointed out and as the record reveals,

the production methods changed over the years, the specifications for the product

varied, Hercules and Vertac used different methods of disposal of dioxin contaminated

filter paper and cardboard drums, and each companies experienced different plant

eruptions. Although Hercules may be able to fairly estimate the production volumes

of 2,4,5-T and 2,4,5-TP from the time it owned the plant, the district court correctly

held that it cannot establish the inferences necessary to prove a reasonable basis for

apportionment of harm. 

Hercules argues that the EPA’s response choices for the soils, groundwater, and

off-site areas are arbitrary and capricious and that Hercules should not be held liable
-24-

for the corresponding response costs. Having considered the record, we conclude that

Hercules’s argument is without merit.

III. UNIROYAL’S LIABILITY 

Uniroyal argues that we should hold that it is not liable as an arranger under

CERCLA, and thus overturn the panel’s decision in Vertac XI. “When a case has

been decided by this court on appeal and remanded to the district court, every question

which was before this court and disposed of by its decree is finally settled and

determined.” Klein v. Arkoma Prod. Co., 73 F.3d 779, 784 (8th Cir. 1996). Absent

intervening controlling authority, we are bound by the decision of the previous panel.

Liberty Mut. Ins. Co. v. Elgin Warehouse & Equip., 4 F.3d 567, 571 (8th Cir. 1993).

Uniroyal pointed to no new controlling authority, and thus the affirmance of the

district court’s finding of liability in Vertac XI is the law of the case. Because that

holding is not “clearly erroneous” nor does letting it stand “work a manifest injustice,”

we refuse to disturb it. Liberty Mut. Ins. Co., 4 F.3d at 570-71. 

IV. RETROACTIVITY

Hercules and Uniroyal contend that the retroactive application of CERCLA to

impose liability is unconstitutional under the Supreme Court’s decision in Eastern

Enterprises v. Apfel, 524 U.S. 498 (1998). We previously resolved this exact issue

in United States v. Dico, in which we held that CERCLA’s retroactive application

remained constitutional after Eastern Enterprises. Dico, 266 F.3d 864, 879-880 (8th

Cir. 2001). We are thus bound by our Circuit’s precedent and accordingly will not

revisit the issue. See United States v. Wright, 22F.3d 787, 788 (8th Cir. 1994) ( “[A]

panel of this Court is bound by a prior Eighth Circuit decision unless that case is

overruled by the Court sitting en banc.”). 
-25-

V. CONCLUSION

The judgment is affirmed.

 ______________________________