Court Opinion

ID: 800770
Source: CourtListenerOpinion
Date Created: 2012-05-23 14:52:40+00
Date Added: 2024-06-11T15:26:05.982900
License: Public Domain

10-4197-cv
     In re September 11 Litigation

                          UNITED STATES COURT OF APPEALS
                              FOR THE SECOND CIRCUIT

                                     SUMMARY ORDER
     RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED
     ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
     PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
     DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
     ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST
     SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

 1            At a stated term of the United States Court of Appeals
 2       for the Second Circuit, held at the Daniel Patrick Moynihan
 3       United States Courthouse, 500 Pearl Street, in the City of
 4       New York, on the 23rd day of May, two thousand twelve.
 5
 6       PRESENT: DENNIS JACOBS,
 7                              Chief Judge,
 8                JOSÉ A. CABRANES,
 9                DEBRA ANN LIVINGSTON,
10                              Circuit Judges.
11
12       - - - - - - - - - - - - - - - - - - - -X
13
14       IN RE SEPTEMBER 11 LITIGATION:
15
16       Cedar & Washington Associates, LLC,
17                Plaintiff-Appellant,
18
19                    -v.-                                               10-4197-CV
20
21       The Port Authority of New York and New
22       Jersey, Silverstein Properties, Inc.,
23       World Trade Center Properties LLC,
24       Silverstein WTC Management Co. LLC, 1
25       World Trade Center LLC, 2 World Trade
26       Center LLC, 3 World Trade Center LLC, 4
27       World Trade Center LLC, 7 World Trade
28       Company, L.P., HMH WTC, Inc., Host

                                                  1
 1   Hotels and Resorts, Inc., Westfield WTC
 2   LLC, Westfield Corporation, Inc.,
 3   Consolidated Edison Company of New
 4   York, AMR Corporation, American
 5   Airlines, Inc., UAL Corporation, and
 6   United Airlines, Inc.
 7            Defendants-Appellees.
 8   - - - - - - - - - - - - - - - - - - - -
 9
10   FOR APPELLANT:             SARI E. KOLATCH (Jay B. Spievack,
11                              Kara Gorycki, Cohen Tauber
12                              Spievack & Wagner P.C., New
13                              York, N.Y., Robert D. Fox, Neil
14                              Witkes, Manko, Gold, Katcher &
15                              Fox LLP, Bala Cynwyd, PA, on the
16                              brief), Cohen Tauber Spievack &
17                              Wagner P.C., New York, N.Y.
18
19   FOR APPELLEES:             LEAH W. SEARS (Beth D. Jacob,
20                              Judith S. Roth, on the brief),
21                              Schiff Hardin LLP, New York,
22                              N.Y., for appellee The Port
23                              Authority of New York and New
24                              Jersey.
25
26                              Richard Williamson, Thomas A.
27                              Egan, Flemming Zulack Williamson
28                              Zauderer LLP, New York, N.Y.,
29                              for appellees Silverstein
30                              Properties, Inc., et al.
31
32                              Christopher Walsh, Paul M.
33                              Hauge, Gibbons P.C., Newark,
34                              N.J., for appellees Host Hotels
35                              and Resorts, Inc. & HMH WTC,
36                              LLC.
37
38                              PETER L. WINIK, Latham & Watkins
39                              LLP, Washington, D.C., for
40                              appellees Westfield WTC LLC &
41                              Westfield Corp., Inc.
42
43                              Charles F. Rysavy, Dawn M.
44                              Monsen, K&L Gates LLP, Newark,
45                              N.J., for appellee Consolidated
46                              Edison Co. of New York, Inc.

                                  2
 1                              MAURA K. MONAGHAN (Roger E.
 2                              Podesta, Debevoise & Plimpton,
 3                              New York, N.Y., Desmond T.
 4                              Barry, Jr., Condon & Forsyth
 5                              LLP, New York, N.Y.), Debevoise
 6                              & Plimpton, New York, N.Y., for
 7                              appellees American Airlines,
 8                              Inc. & AMR Corp.
 9
10                              Jeffrey J. Ellis, Quirk and
11                              Bakalor, P.C., New York, N.Y.,
12                              Michael R. Feagley, Mayer Brown,
13                              LLP, Chicago, Ill., for
14                              appellees United Air Lines, Inc.
15                              & United Continental Holdings,
16                              Inc.
17
18        Appeal from a judgment of the United States District
19   Court for the Southern District of New York (Hellerstein,
20   J.).
21
22        UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED
23   AND DECREED that the judgment of the district court be
24   REMANDED.
25
26        Plaintiff Cedar & Washington Associates, LLC appeals
27   from a judgment of the United States District Court for the
28   Southern District of New York (Hellerstein, J.), dismissing
29   its complaint. Cedar & Washington sought recovery of
30   abatement costs incurred after its building in lower
31   Manhattan was infiltrated by hazardous substances produced
32   by the terrorist attacks at the World Trade Center on
33   September 11, 2001.
34
35        Sometime after September 11, 2001, Cedar & Washington
36   undertook to renovate its 12-story office building into a
37   19-story business hotel. It was notified by the New York
38   State Department of Environmental Conservation and the
39   United States Environmental Protection Agency of the
40   possibility that the interstitial spaces of its building
41   might contain so-called “WTC Dust,” which according to the
42   complaint is composed of finely ground substances from the
43   destruction of the World Trade Center, including concrete,
44   asbestos, silicon, fiberglass, benzene, lead, and mercury.
45   To continue renovations, the governmental agencies required
46   Cedar & Washington to remediate the WTC Dust through costly
47   cleanup measures. In this suit, Cedar & Washington seeks to

                                  3
 1   recover those costs from defendants, which include the owner
 2   of the World Trade Center site, lessees of World Trade
 3   Center buildings, and the companies that owned and operated
 4   the two aircraft that were crashed into the Twin Towers.
 5
 6        The claims are premised on the Comprehensive
 7   Environmental Response, Compensation, and Liability Act
 8   (“CERCLA”), 42 U.S.C. §§ 9601-9675, and common-law
 9   indemnification. The district court dismissed the claims on
10   two alternative grounds: (1) construction of scaffolding by
11   the Federal Emergency Management Agency (“FEMA”) in the
12   immediate aftermath of September 11 was “initiation of
13   physical on-site construction of the remedial action” for
14   the purpose of CERCLA’s statute of limitation, see 42 U.S.C.
15   § 9613(g)(2)(B), and Cedar & Washington’s 2008 lawsuit was
16   therefore untimely; and (2) Cedar & Washington failed to
17   allege either a “release” or a “disposal” of hazardous
18   substances necessary to pursue a claim for cost recovery
19   under CERCLA § 107(a)(1) and (a)(2). 42 U.S.C. § 9607(a)(1)
20   & (a)(2). Following dismissal of the CERCLA claim, the
21   district court dismissed the indemnification claim as
22   “academic.” In addition to the grounds upon which they
23   prevailed, defendants made a number of other arguments as to
24   why the lawsuit should be dismissed at the pleading stage.
25   They have renewed many of those arguments on appeal.
26
27        The 96th Congress passed CERCLA “in response to the
28   serious environmental and health risks posed by industrial
29   pollution” and “to promote the ‘timely cleanup of hazardous
30   waste sites.’” Burlington N. & Santa Fe Ry. Co. v. United
31   States, 556 U.S. 599, 602 (2009) (quoting Consol. Edison Co.
32   of N.Y. v. UGI Util., Inc., 423 F.3d 90, 94 (2d Cir. 2005)).
33   Cedar & Washington’s CERCLA claims invite the application of
34   CERCLA to a unique and unforeseen factual circumstance.
35   Their resolution may involve thorny questions of statutory
36   interpretation. We are reluctant to resolve such questions
37   absent consideration of a threshold question: whether the
38   attack on the World Trade Center on September 11 was an “act
39   of war” within the meaning of CERCLA’s affirmative defense.
40
41        CERCLA Section 107(b) provides an affirmative defense
42   in any situation where the “release or threat of release of
43   a hazardous substance” was “caused solely by . . . (2) an
44   act of war.” 42 U.S.C. § 9607(b). The district court was
45   not presented with an opportunity to consider the issue,
46   although all defendants asserted or adopted the affirmative
47   defense in their answers to the complaint. We therefore

                                  4
 1   issue the mandate to the district court for the limited
 2   purpose of allowing it to decide in the first instance
 3   whether the act-of-war exception in CERCLA, considered in
 4   the context of CERCLA’s statutory scheme and the intent of
 5   Congress, applies in this case. But we will retain
 6   jurisdiction over the case.
 7
 8
 9        For the foregoing reasons, following the procedures set
10   forth in United States v. Jacobson, 15 F.3d 19, 22 (2d Cir.
11   1994), a mandate shall issue forthwith remanding this cause
12   to the district court, where it shall permit liberal
13   repleading of the act-of-war defense, solicit briefing from
14   the parties in an expeditious manner, and render a decision
15   within 75 days of the date of this order. After the
16   district court’s decision, any party to this appeal may
17   restore jurisdiction to this court within 30 days by letter
18   to the Clerk’s Office seeking review, without need for a new
19   notice of appeal. The Clerk’s Office will then set an
20   expedited briefing schedule and refer the appeal to this
21   panel.
22
23
24                              FOR THE COURT:
25                              CATHERINE O’HAGAN WOLFE, CLERK
26

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