ELR Citation: ELR 20643
No(s). C90-5166B (W.D. Wash. Nov 29, 1990)

The court rules that the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) does not preempt state statutes determining the capacity of a corporation to be sued and that shareholders of a dissolved corporation may be held individually liable under CERCLA as owners/operators of a contaminated site. Plaintiff corporation brought an action under CERCLA §107(a) against a dissolved Washington State corporation and two of its shareholders to recover costs incurred in cleaning up property the plaintiff purchased from the dissolved corporation. The plaintiff's action was brought more than three years after the defendant corporation was dissolved. Washington State law bars claims brought against corporations that have been dissolved for more than two years. Based on precedent in the Ninth Circuit, the court first holds that CERCLA does not preempt state laws determining the capacity of corporations to be sued. However, based on the law of federal preemption, the court notes that CERCLA's statutory language and legislative history compel the conclusion that CERCLA preempts state capacity statutes that conflict with CERCLA's policies and goals. The court next denies the defendants' motion to dismiss the plaintiff's CERCLA §107(a) claims against the two shareholders as owners/operators of the contaminated site. The court rules that individual liability under CERCLA §107(a) may flow to officers, directors, shareholders, and employees of a corporation from the meaning of "operator" under CERCLA. Further, the court finds that genuine issues of material fact exist concerning the status of the two shareholders with respect to the corporation, the ownership of the contaminated site, and the shareholders' personal involvement with the disposal of hazardous substances at the site.

Counsel for Plaintiff
Peter H. Haller
Karr Tuttle Campbell
1201 Third Ave., Ste. 2900, Seattle WA 98101-3028
(206) 223-1313

Counsel for Defendant
Kevin G. Staples
Landerholm, Memovich, Lansverk & Whitesides
Pacific First Federal Savings Bldg., P.O. Box 1086, Vancouver WA 98666
(206) 696-3312