Source: https://elr.info/sites/default/files/litigation/18.20470.htm
Timestamp: 2019-11-18 10:01:09
Document Index: 328543451

Matched Legal Cases: ['§ 107', '§ 107', '§ 107', '§ 107', '§ 101', '§ 107', '§ 106', '§ 9607', '§ 1291', '§ 1292', '§ 107', '§ 9607', '§ 111', '§ 9611', '§ 101', '§ 9601', '§ 2201', '§ 9606', '§ 107', '§ 107']

18 ELR 20470 -- Cadillac Fairview/California, Inc. v. Dow Chemical Co.
18 ELR 20470 | Environmental Law Reporter | copyright © 1988 | All rights reserved
Nos. 86-6464; 6733 (9th Cir. February 25, 1988)
The court rules that prior federal authorization is not required for private parties to recover response costs under § 107(a) of the Comprehensive Environmental, Response, Compensation, and Liability Act (CERCLA). The court also holds that prior state or local action is not required for private actions under § 107(a). Nothing in § 107(a) indicates that a private party must await such approval, CERCLA provides no mechanism through which a private party could seek approval from state or local governments or prompt them to take action, there is no indication that Congress intended state and local governments to devote their limited resources to this procedure, and defendants are protected from paying for ill-conceived cleanup actions by § 107(a)'s requirement that response costs were necessary and consistent with the national contingency plan. The court holds that the testing and security expenditures alleged by plaintiff are recoverable costs of response under CERCLA § 101(23). The court holds that plaintiff's claim for a declaration that defendants are solely liable under CERCLA and other laws for the existence of hazardous substances at the site is ripe for review, since plaintiff has alleged that defendants have disposed of waste at the site. The absence of a government enforcement action does not render this declaratory relief claim premature. The court rules that CERCLA does not establish a private right of action for injunctive relief. To imply a private right of action for injunctive relief in § 107(a) would render the express grant of injunctive authority to the federal government in § 106(a) redundant.
[District court decisions appear at 14 ELR 20376 and 20716.]
Suite 900, 1800 Avenue of the Stars (Century City), Los Angeles CA 90067-4276
(213) 277-1010
Stephen T. Swanson
700 S. Flower St., Los Angeles CA 90017
(213) 629-9300
Before Chambers and Poole, JJ.
[18 ELR 20470]
Cadillac Fairview/California, Inc. (Cadillac Fairview) appeals the district court's judgment dismissing its claims for damages and for declaratory and injunctive relief against Dow Chemical Co. (Dow) and Shell Oil Co. (Shell) for failure to state a claim upon which relief can be granted. Cadillac Fairview also appeals the order granting summary judgment in favor of the Administrator of the General Services Administration (GSA) and the United States of America (federal defendants). On appeal, Cadillac Fairview contends that the district court's order dismissing its claims and granting summary judgment was premised on an erroneous interpret ation of section 107(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CER-CLA), 42 U.S.C. § 9607(a). We have jurisdiction under 28 U.S.C. § 1291 and 28 U.S.C. § 1292(b). We reverse the dismissal of Cadillac Fairview's claims for damages and declaratory relief against Shell and Dow, and we reverse the summary judgment in favor of the federal defendants. We affirm the dismissal of Cadillac Fairview's claims for injunctive relief.
Cadillac Fairview's complaint alleges that it is the owner of [18 ELR 20471] certain real property (the Site) located in Torrance, California. Cadillac Fairview purchased the Site from CC&F Western Development Co., Inc. (Western) in 1976. It later learned that hazardous substances had been deposited at the Site, and that these substances had migrated into the underlying soil. Cadillac Fairview conducted chemical tests and analyses at the Site, which indicated that the presence of various hazardous substances in the soil threatened to cause substantial environmental and health problems. State officials requested Cadillac Fairview to undertake certain steps to protect neighborhood residents from illnesses that might result from contact with the hazardous substances. Pursuant to the state's request, Cadillac Fairview hired engineers to conduct chemical testing at the Site to evaluate the hazards posed by the substances, erected a fence around the Site, employed a guard service to secure the Site from trespassers, and posted bilingual "no trespassing" signs at the Site. These measures allegedly cost Cadillac Fairview in excess of $70,000.
Cadillac Fairview sued the federal defendants, Dow, and Shell in district court under CERCLA § 107(a), 42 U.S.C. § 9607(a), to recover its costs of responding to the hazardous substances. Cadillac Fairview also requested a declaration that any cleanup costs or other damages resulting from the presence of the hazardous substances should be borne only by Dow, Shell, the federal defendants, or others who owned the property at the time of the dumping or who were responsible for such dumping. Finally, it requested an injunction requiring Dow, Shell, CC&F, and the GSA to remove hazardous wastes from the Site. Cadillac Fairview also brought state law claims against various defendants.
On the motions of Dow and Shell, the district court dismissed Cadillac Fairview's CERCLA claims for failure to state a claim upon which relief could be granted, and dismissed the pendent state law claims for lack of jurisdiction. The district court certified its order for immediate appeal under section 1292(b). The federal defendants' motior, for summary judgment was granted, and the judgment certified for appeal under Fed. R. Civ. P. 54(b). We consolidated the appeals.
We review de novo the district court's dismissal of Cadillac Fairview's federal claims for failure to state a claim upon which relief could be granted. Wickland Oil Terminals v. Asarco, Inc., 792 F.2d 887, 889 (9th Cir. 1986) (Wickland). We must accept all the material allegations in the complaint as true and view them in the light most favorable to Cadillac Fairview. Id. at 889-90. The dismissal must be reversed unless it appears to a certainty that Cadillac Fairview is not entitled to relief under any state of facts that it could have proved. Id. at 890.
Section 107(a)(2)(B) expressly creates a private claim against any person who owned or operated a facility at the time hazardous substances were disposed of at the facility for recovery of necessary costs of responding to the hazardous substances incurred consistent with the national recovery plan. See id. at 890; NL Industries, Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir. 1986) (NL Industries). Cadillac Fairview alleged that it incurred "necessary costs" of response within the meaning of section 107(a), and that Dow, Shell, and the federal defendants owned or operated the Site at the time that hazardous substances were deposited there. Despite these allegations, the district court dismissed Cadillac Fairview's suit against the private defendants for failure to state a claim under section 107(a).
In defense of the district court's ruling, Dow argues that a private action under section 107(a) must be preceded by federal governmental action with respect to the property in question. This argument ignores our holdings in Wickland and NL Industries. In Wickland, we rejected the defendant's argument that in order to incur costs "consistent with the national contingency plan," a private party must act pursuant to federal governmental authorization. 792 F.2d at 891-92. Though the national contingency plan describes the role of lead agencies in examining information and determining appropriate responses to environmental hazards, id. at we held that such provisions do not constrain private parties seeking to recover response costs under section 107(a). Id. at 892. We concluded that this reading of section 107(a) was supported both by "the lack of any procedure whereby a private party could seek to obtain prior governmental approval of a cleanup program" and by CERCLA's broad remedial purpose to promote private enforcement actions "independent of governmental actions financed by Superfund." Id. at 892. In NL Industries. we reaffirmed our holding in Wickland, and rejected the argument that response costs cannot be deemed "necessary" in the absence of lead agency approval of the cleanup. 792 F.2d at 898. Because Dow's contention that action by the federal government or by a lead agency is a necessary prerequisite to a private response action under section 107(a) is indistinguishable from the arguments rejected in Wickland and NL Industries. we need not consider it further.
[18 ELR 20472]
First, there is nothing in the plain language of section 107(a) that indicates that a party seeking to recover its costs of response must await approval of or action by a state or local governmental entity. In contrast, CERCLA § 111(a)(2), 42 U.S.C. § 9611(a)(2), specifically provides that necessary costs may be recovered from the Superfund only if such costs are approved under the national contingency plan and certified by the responsible federal official. The absence of an approval or certification requirement in section 107(a) justifies the inference that parties not seeking reimbursement from the Superfund need not obtain prior governmental approval for their response action to be "necessary" or "consistent with the national contingency plan" under section 107(a).
Dow argues that without preliminary governmental action, a defendant can be forced to pay for cleanup actions that are inadequate or ill-conceived. This argument ignores the plain language of the statute. Section 107(a) does not allow recovery of any and all costs of response that a private party incurs. To recover costs under section 107(a), the party undertaking the response action must prove that the costs it incurred were "necessary" and that it incurred those costs in a manner "consistent with the national contingency plan." A response action is consistent with the plan for purposes of section 107 only if it satisfies criteria set forth in pertinent regulations. See, e.g., 40 C.F.R. 300.71(a)(2)(1986). Under this statutory and regulatory scheme, the question whether a response action is necessary and consistent with the criteria set forth in the contingency plan is a factual one to be determined at the damages stage of a section 107(a) action, rather than by the mechanism of prior governmental approval. Dow and Shell will have ample opportunity at trial to express their concern that the costs incurred by Cadillac Fairview in this case were unnecessary or inconsistent with the national contingency plan.
As an alternative ground for the dismissal of Cadillac Fairview's damages claims, the district court held that Cadillac Fairview failed to allege that it incurred "cleanup" costs within the meaning of section 107(a). We rejected the distinction between investigatory costs and on-site cleanup costs in Wickland. 792 F.2d at 892. Section 107(a)(2)(B) allows recovery of "costs of response," which includes costs incurred "to monitor, assess, and evaluate the release or threat of release of hazardous substances," and costs of actions "necessary to prevent . . . damage to the public health . . . [including] security fencing or other measures to limit access." See CERCLA § 101(23), 42 U.S.C. § 9601(23). The testing and security expenditures alleged by Cadillac Fairview fall within the ambit of those defined by section 9601(23). The district court thus erred in holding that Cadillac Fairview failed to state a claim for recovery of those costs under section 107(a)(2)(B).
Pursuant to 28 U.S.C. § 2201, Cadillac Fairview sought a declaration that Dow, Shell, and the federal defendants were solely and entirely liable under CERCLA and other applicable law for the existence of any hazardous substances at the Site. The district court ruled that these claims for declaratory relief were premature in the absence of a governmental enforcement action under CERCLA against Cadillac Fairview.
In Wickland, we held that the essential fact establishing a CERCLA plaintiff's right to declaratory relief is the alleged disposal of hazardous substances at the site in question. Id. at 893. The absence of a government enforcement action under CERCLA does not render the controversy between the party seeking declaratory relief and the party who owned the site at the time of hazardous waste disposal remote and hypothetical. Id. Our analysis of the ripeness issue in Wickland compels [18 ELR 20473] reversal in this order as well. Cadillac Fairview has alleged the occurrence of the essential facts establishing its right to a declaratory judgment. Therefore, we reverse the district court's dismissal of this claim against Dow and Shell, and reverse the summary judgment in Cadillac Fairview's suit for declaratory relief against the federal defendants for further consideration.
Cadillac Fairview also pleaded a claim for injunctive relief ordering Dow, Shell, CC&F, and the federal defendants to undertake appropriate response actions with respec to the Site in a manner consistent with the national cont ngency plan. Cadillac Fairview predicated this claim on its request for declaratory relief. The district court dismissed the claims for injunctive relief, holding that no private cause of action for injunctive relief exists under CERCLA. Cadillac Fairview argues that our holding in Wickland establishes a right to injunctive relief under CERCLA.
In the present case, the district court fully considered the question whether CERCLA establishes a private right of action for injunctive relief. The district court examined CERCLA's provisions and found that the only private remedy provided in CERCLA is the private cause of action for response costs described in section 107(a). Under section 107(a), the United States, a State, an Indian Tribe, or any other person may recover necessary costs of response incurred consistent with the national contingency plan. There is no mention of a right to injunctive relief in section 107(a). In contrast, under section 106(a), the President may require the Attorney General to seek injunctive relief "when the President determines that there may be an imminent and substantial endangerment to the public health or welfare or the environment." 42 U.S.C. § 9606(a). The district court concluded that the failure to provide for injunctive relief in section 107(a), coupled with the absence of any provision for a private right of action under section 106(a), mandated the conclusion that Congress did not intend to create a private cause of action for injunctive relief under CERCLA.
We find convincing the inference that the district court drew from construing sections 106 and 107 together. Section 107(a) allows the United States, States, Indian tribes, and other persons to recover their necessary costs of response from owners and operators as defined by section 107(a)(2), but makes no mention of injunctive relief. Section 106(a), by contrast, expressly grants the President authority to seek injunctive relief under limited circumstances. We agree with the Second Circuit that to imply a private right of action for injunctive relief into section 107(a) would render the express grant of injunctive authority in section 106(a) redundant. State of New York v. Shore Realty Corp., 759 F.2d 1032, 1049 (2d Cir. 1985). Moreover, to allow parties entitled to damages under section 107(a) to seek injunctive relief under that section would enable such parties to bypass the specific limitations on the President's authority to seek injunctive relief described in section 106(a). We find this result inconsistent with the plain language of the statute. See Botany Worsted Mills v. United States, 278 U.S. 282, 289 (1929) ("When a statute limits a thing to be done in a particular mode, it includes the negative of any other mode.").
We conclude, therefore, that CERCLA § 107(a) does not provide for a private right to injunctive relief against owners and operators as defined by section 107(a)(2). Sections 106(a) and 107(a) indicate that when Congress wished to provide for injunctive relief under CERCLA, it knew how to do so and did so expressly. The district court's dismissal of Cadillac Fairview's claims for injunctive relief against Dow,Shell, CC&F, and the federal defendants is affirmed.
Cadillac Fairview challenges the dismissal of its pendent state law claims against Dow and Shell. The district court based its dismissal of these pendent claims on its ruling that Cadillac Fairview failed to state a claim arising under CERCLA. Because we hold that Cadillac Fairview's claims for damages and declaratory relief stated claims for relief under CERCLA § 107(a), we reverse the dismissal of the state law claims and remand them for further consideration.