ELR Citation: ELR 21609
No(s). 91-5118 (E.D. Pa. Mar 5, 1993)

The court holds that a purchaser of a company's assets who did not know of, and was not responsible for, the transfer of hazardous wastes to a landfill is not a corporate successor and, therefore, is not liable under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) in a government cost recovery action. Under the continuity of enterprise theory for successor liability under CERCLA, the sale of company assets did not render the purchaser a responsible party for cleanup costs. The seller had ceased transferring wastes to the landfill about 13 years before the sale, the purchaser had no ties to the seller, and the purchaser was not responsible for the transfer of the waste to the landfill. The court holds that the purchaser is not a mere continuation of the seller, because there is no evidence of identity of stockholders or directors. The court refuses to apply a broader continuity of enterprise approach, because the broader test is relevant only when the application of traditional corporate law principles would frustrate the goals of CERCLA.

Counsel for Plaintiff
Robert B. Hoffman
Reed, Smith, Shaw & McClay
213 Market St., P.O. Box 11844, Harrisburg PA 17108
(717) 234-5988

Counsel for Defendants
Neil R. Bigioni, Alan V. Klein
Saul, Ewing, Remick & Saul
3800 Centre Sq. W., Philadelphia PA 19102
(215) 972-7777