ELR Citation: ELR 20251
No(s). 99-3294 (3d Cir. Oct 31, 2000)

The court holds that the Superfund Recycling Equity Act applies retroactively to judicial actions initiated by private parties prior to November 29, 1999. Therefore, the court vacates a district court's grant of summary judgment in favor of a battery recycler who sought contribution costs from potentially responsible parties (PRPs), including several scrap metal dealers, for cleanup of a battery recycling site. The recycler entered into a consent agreement with the U.S. Environmental Protection Agency under the Comprehensive Environmental Response, Compensation, and Liability Act for the contamination. The recycler sought contribution from the PRPs, and the district court held the PRPs liable for a portion of the site's response costs. After the scrap dealers filed their notice of appeal, Congress passed the Superfund Recycling Equity Act.

The court first holds that the Superfund Recycling Equity Act applies retroactively to private actions that were still pending when Congress enacted the Act. The Act states that it has no effect on any concluded judicial or administrative action initiated by the United States prior to its enactment. The Act does exempt from retroactive application those actions completed prior to November 29, 1999, whether judicial or administrative in nature, and those pending actions initiated by the United States prior to November 29, 1999, but only if they are judicial in nature. The Act is silent as to actions initiated by private parties. The recycler argues that a private judicial action that was initiated following a related federal administrative action—in this case, a consent agreement—should be deemed as having been initiated by the United States and, thus, exempt. However, the legislative history indicates that the Act provides for relief from liability for both retroactive and prospective transactions and any pending judicial action, whether brought in a trial or appellate court by a private party. The legislative history also explains that any third-party action or joinder of defendants brought by a private party shall be considered a private-party action, regardless of whether or not the original lawsuit was brought by the United States. Thus, if the Act applies retroactively to private-party actions prompted by exempted federal actions, it makes no sense to conclude that it does not apply retroactively to private actions prompted by non-exempt administrative actions. The court also holds that the Act does not violate the Fifth Amendment Due Process Clause because it lacks a rational basis. The distinction between privately and federally initiated judicial actions is rationally related to preserving public finances. The court, therefore, remands the case to determine whether the scrap dealers satisfy the Act's requirements for exemption from liability.

Prior decisions in this litigation are digested at 26 ELR 20516 and 21614, 27 ELR 20774, 20838, and 20840, and 28 ELR 20277.]

Counsel for Appellants
Donald B. Mitchell Jr.
Arent, Fox, Kintner, Plotkin & Kahn
1050 Connecticut Ave. NW, Washington DC 20036
(202) 857-6000

Counsel for Appellee
Dennis R. Suplee
Schnader, Harrison, Segal & Lewis
1600 Market St., Ste. 3600, Philadelphia PA 19103
(215) 751-2000

Before Sloviter and Fuentes, JJ.