ELR Citation: ELR 20103
No(s). 91-5118 (E.D. Pa. Mar 1, 1994)

The court enters a Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) consent decree between the United States and potentially responsible parties (PRPs) despite objections by the PRPs and other third parties, in light of United States v. Rohm & Haas Co., 23 ELR 21345 (3d Cir. 1993), to aspects of the decree regarding the U.S. government's recovery of certain oversight costs. Four months after the United States lodged with the district court the consent decree at issue, the Third Circuit held in Rohm & Haas that certain government oversight costs incurred in monitoring a private hazardous waste cleanup are not recoverable under CERCLA §107. The decree in this action provides that PRPs will reimburse the government for any future oversight costs that the U.S. Environmental Protection Agency (EPA) might incur in overseeing the PRPs' privately funded response actions.

Analyzing the Rohm & Haas decision, the court determines that this action is distinguishable from that action. The court determines that the Rohm & Haas holding is limited to whether the oversight costs at issue were recoverable as costs of removal, whereas the costs at issue in this case are more properly characterized as remedial. The court holds that a court-made doctrine requiring clear congressional expression of intent for EPA to exact oversight costs that do not inure to the benefit of the regulated parties does not bar entry of the decree, because the decree's procedures for resolving disputed assessments make federal courts the ultimate arbiters of disputes. The court, however, defers consideration of challenges under this doctrine until costs are properly assessed and disputed.

The court holds that the decree is reasonable, fair, and consistent with the goals that CERCLA is intended to serve. Although Rohm & Haas was decided after the decree's negotiations were concluded that decision does not render the decree unreasonable. Courts evaluate a decree's reasonableness by the parties' relative bargaining strengths based on what the parties knew or should have known at the time the parties agreed to be bound. The court holds that the decree is the product of a procedurally fair process, and that the decree is not substantively unfair in light of Rohm & Haas. The court holds that despite the objections of nonsettling parties, who claim that the settlement will saddle nonsettlors with disproportionate liability, the result is neither unfair nor proscribed by CERCLA. The decree provides contribution protection to the settling PRPs only for costs for which those PRPs have resolved their liability to the U.S. government. Also, the decree resolves the settling PRPs' liability only insofar as those PRPs reimburse EPA for those costs. Finally, the court holds that the settlement will serve the goals of CERCLA. The PRPs failed to identify how the government's recovery of oversight costs, even in light of Rohm & Haas, frustrates these goals.

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

Counsel for Plaintiff
Nancy Flickinger, Anna L. Wolgast
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Counsel for Defendants
Fredric C. Jacobs
214 Bushkill St., Easton PA 18042
(610) 253-9389