Opinion ID: 203380
Heading Depth: 3
Heading Rank: 3

Heading: Substantive Fairness

Text: We give deference to the trial judge's sense of the substantive fairness of the Decree, regardless of the fact that we do not have the EPA's assessment, but only the State's. Cf. Davis, 261 F.3d at 24. Usually, there is deference to the EPA's judgment on fairness, and no independent court inquiry. 2 Topol & Snow, supra, § 7:91, at 173-75. Here, the court appropriately first reasoned, after its long history with the case, that it was amply satisfied that there was procedural fairness, that this contributed to its conclusion of substantive fairness, and that this Decree was substantively fair. Bangor II, 2007 WL 1557426, at -7. The court calibrated the estimated total costs of the cleanup against the respective monetary liability being assumed by the City and Citizens. The court took notice that the DEP had previously estimated the range of possible cleanup costs to be between $13.2 million and $21.9 million. Id. at  n. 11. The court noted that since the total costs of remediation were unknown, and the amount of contribution was unknown, both the City and Citizens were taking on risk. The cleanup, however, was guaranteed, as was the payment of response costs. Id. at . Appellants argue that the court was obligated to do more. Specifically, they argue the fairness component is meant to provide them rigorous protection in the end from paying more than their fair share. From the point of view of the third and fourth parties, Citizens should not, with the total amount being unknown, be able to cap its liability at $7.625 million. We think this is a misapprehension of the fairness doctrine. The oft-cited language from cases where the United States is a party is that the substantive fairness inquiry involves corrective justice and accountability, concentrating on `the proposed allocation of responsibility as between settling and non-settling PRPs.' Davis, 261 F.3d at 24 (quoting Charles George Trucking, 34 F.3d at 1088). Thus, the substantive fairness inquiry considers fairness in terms of both larger societal concepts such as corrective justice and fairness to non-settling parties. Under SARA, Congress intended there to be some mechanism to police the EPA's conduct in settlements. Congress enacted SARA in 1986 in order to rein-in the EPA; for instance, section 122 contains detailed provisions that restrict EPA's freedom to conduct negotiations and to enter into CERCLA settlement agreements. 1 Topol & Snow, supra, § 1:3, at 14, 16; see also Cannons, 899 F.2d at 89 (acknowledging the possibility of coercive government settlement practices). That concern about overseeing whether the EPA has been fair is not our concern here. Further, this court has tended to treat private parties in CERCLA settlement cases as entities who can protect themselves, assuming the procedures are fair. This circuit has stressed that [t]here is little need for a court to police the substantive fairness of a settlement as among settling parties of a particular class. Sophisticated actors know how to protect their own interests, and they are well equipped to evaluate risks and rewards. Charles George Trucking, 34 F.3d at 1088. Therefore, a court can usually confine its inquiry to the substantive fairness of the aggregate class contribution, or, put another way, to the proposed allocation of responsibility as between settling and non-settling parties. Id. As a result, it would have served no useful purpose [for the district court] to go further and focus the lens of inquiry on the fairness of each class member's contribution. Id. Settlements do not demand perfection. There are many factors involved. [A] PRP's assumption of open-ended risks may merit a discount on comparative fault, while obtaining a complete release from uncertain future liability may call for a premium. Cannons, 899 F.2d at 88. Even more, this case exemplifies the principle that there is a need to suitably reward early settlements, particularly cost-effective ones. Id. Appellants have been excused from the costs of the Phase One litigation; they could have chosen to pursue settlement themselves, but chose not to do so. Here, the data used to apportion liability fell within the broad spectrum of plausible appropriations. Id. The district court's evaluation of substantive fairness was well within its discretion and this circuit's case law.