City Barred From Recovering Environmental Costs Against Private Parties

by Lisa Bond and Norm Dupont

August 2010

The City of Colton was confronted with a common problem:  Contamination (in this case a compound associated with fireworks and rocket manufacturing) that exceeded a state drinking water 'notification level' but for which there was no state or federal formal drinking water guideline.  The City decided to take action rather than face the alternative of angry residents, and paid over $4 million to treat contaminated groundwater used as a source of drinking water for the City.  It sought recovery of the $4 million it had paid to date as well as a declaration that the private industrial parties, a group of fireworks manufacturers and rocket manufacturers, should be liable for future cleanup.  The City's lawsuit was premised on the federal Superfund statute, CERCLA, 42 U.S.C. Section 9601.  The County of San Bernardino was a named defendant in the City's lawsuit, since the County had purchased a substantial amount of land containing former fireworks "bunkers" as part of its effort to expand a landfill, the Mid-Valley Landfill.  By virtue of its purchase of contaminated property, the County became an "owner" and therefore, a "potentially liable party" under Superfund terms.

Superfund liability is said to be "joint and several" with very limited defenses.  But, as the City of Colton found out, "very limited" defenses is not the same as having no defense.  The federal Superfund statute sets forth a set of procedural requirements, which must be complied with in substantial measure by any plaintiff seeking recovery under the statute.  The procedural requirements are set forth in EPA regulations commonly known as the "National Contingency Plan" or NCP.  Carson Harbor Village, Ltd. v. Unocal Corp., 270 F.3d 863, 870-71 (9th Cir. 2001) (en banc).  The City of Colton, however, failed to comply with the NCP procedures including the provision requiring an initial engineering evaluation and costs analysis and an opportunity for public comment. These procedural failures doomed both the City's effort to collect its past costs for the environmental contamination as well as its effort to obtain a declaration that the defendants were liable to it for its future remedial costs.  City of Colton, supra, Doc. No. 06-56718, slip op. at 11145-11153.

Lisa Bond obtained summary judgment for the City of Carson in the key Ninth Circuit case on compliance with NCP rules, Carson Harbor.  Norm Dupont represented eleven Inland Empire Cities that litigated and won back fees imposed by the County of San Bernardino that the County justified based upon its increased environmental remediation costs at the Colton/Rialto Mid-Valley Landfill.  For more information on the requirements for filing and winning a federal environmental cost-recovery suit under CERCLA or avoiding liability under CERCLA in purchasing contaminated property, please contact: Lisa Bond or Norm Dupont at 213.626.8484. 

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