Opinion ID: 3012864
Heading Depth: 4
Heading Rank: 4

Heading: Useful Product Defense

Text: The District Court characterized the PVM transactions as “sales transactions” and referred to the “useful product defense” discussed in Pneumo Abex Corp. v. High Point, Thomasville and Denton R.R. Co., 142 F.3d 769, 774 (4th Cir. 1998). (App. at 13-14). Tenneco argued below, and continues to argue on appeal, that this defense applies because the transactions at issue were nothing more than a sale of a useful product (PVM) and a purchase of finished products (ROM and YOM). We believe that there are disputed facts with respect to the critical elements of this defense.‘’ In Pneumo Abex, the court concluded that “ ‘treatment . . . of hazardous substances’ as used in CERCLA refers to a party arranging for the processing of discarded hazardous substances or processing resulting in the discard of hazardous substances.” 142 F.3d at 774. Accordingly, the sale of valuable materials to a processor alone does not satisfy the requirements for “arranger liability.” See Glaxo Wellcome, Inc., 189 F.3d at 164; Solvent Chemical Co., 225 F. Supp. 2d at 280. We agree with Tenneco that the sale of PVM alone or the purchase of ROM and YOM alone — without evidence of ownership or possession, knowledge, and control — would not be sufficient grounds on which to impose “arranger liability.” Those transactions would either not meet the standard we have articulated or would fall within the “useful product defense.” It would be inappropriate at this stage in the proceedings, however, to conclude that the transactions between Tenneco and the plant were nothing more than a sale of PVM or the purchase of ROM and YOM because of the factual disputes we have described with 24 respect to the key elements of ownership or possession, knowledge, and control.