ELR Citation: ELR 20506
No(s). 91-5118 (E.D. Pa. Nov 22, 1993)

The court holds that the purchaser of the assets of a corporation that allegedly arranged for the disposal of hazardous waste is not liable for contribution in a cost recovery action under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). The court holds that the asset purchaser does not fall under CERCLA's "mere continuation" exception to the general rule precluding liability for corporate successors, because although the successor operates the same type of business under a similar name, there is no identity of stock, stockholders, and directors between it and its predecessor. The court declines to apply the broader "continuity-of-enterprise" theory of liability, which the court notes should be used only when the application of traditional corporate law principles would frustrate CERCLA's goal of having responsible parties contribute to cleanup costs. This is not such a case, because the purchaser had no knowledge or actual notice of the seller's potential CERCLA liability, the purchaser had no substantial or continuous ties to the seller, and there is no evidence that the parties entered into the transaction strategically to evade CERCLA liability.

[Earlier decisions in this litigation are published at 23 ELR 20288 and 23 ELR 21609.]

Counsel for Plaintiff
David A. Garrison, Ass't U.S. Attorney
U.S. Attorney's Office
3310 U.S. CtHse.
Independence Mall W., 601 Market St., Philadelphia PA 19106
(215) 597-1716

Counsel for Defendant
Frederick C. Jacobs
214 Bushkill St., Easton PA 18042
(215) 253-9389