The U.S. Supreme Court has decided to hear a closely watched environmental case that may have significant financial implications for both the federal government and private industry. The case, U.S. v. Atlantic Research Corp., is Part II of a duo of cases that consider whether companies can recover costs incurred to cleanup contaminated sites under the Comprehensive Environmental Response, Compensation and Liability Act, when the cleanup effort was voluntarily carried out, rather than compelled by a lawsuit or government order.
In Part I of the two cases, Cooper Industires, Inc. v. Aviall Industries, Inc., the court ruled that parties who voluntarily cleaned up a hazardous waste site could not recover from other parties, including the government, under Section 113 of CERCLA--the contribution section of the federal Superfund cleanup statute, which allows one private party to sue another liable party, including governmental bodies.
In Part II, the Atlantic Research case, the court will review Section 107, the general cost recovery provision of the statute, which is typically used by a government body or private party to sue for cleanup costs when the plaintiff is not otherwise liable for the cleanup. The federal appeals courts are divided as to whether a private party liable under CERCLA can recover the share of costs other are responsible for under the Act. Thus, the Supreme court may rule as to the ability of parties to bring cases at all when they voluntarily perform cleanup without first being sued or being the subject of a governmental enforcement order.
While voluntary cleanup has been growing, promoted by industry and government alike, the federal government has argued in its briefs to restrict the ability of such volunteers to recover their costs from other liable parties, primarily because the government itself is often a liable party. This is simply bad public policy, exercised by a Justice Department more motivated by winning cases than helping responsible companies recover their costs when they step up and cleanup up a hazardous waste site while other entities and governmental bodies stand by and do nothing.
We will have to await the Supreme Court's ruling as to whether private cost recovery actions are permissible under Section 107 of CERCLA. If the court rules that plaintiffs cannot recover under Section 107 for voluntary actions or otherwise, then calls for a fix from Congress will grow to amend the statute to allow such contribution or direct actions in order to encourage private parties to conduct cleanup of hazardous waste sites without being subject to litigation or government order.