ELR Citation: ELR 20874
No(s). 86-Z-369 (D. Colo. Feb 25, 1997)

The court holds that the United States and Colorado may recover from defendant potentially responsible party (PRP) response costs incurred in cleaning up the Broderick Wood Products Company site. The court previously found defendant liable under the Comprehensive Environmental Response, Compensation, and Liability Act for contaminating the northwest section of the site. The court first rejects the government's argument that in order to demonstrate that the U.S. Environmental Protection Agency's (EPA's) actions were inconsistent with the national contingency plan (NCP), defendant must show that any departure from the NCP resulted in expenditures demonstrably in excess of those that would have been incurred otherwise. Defendant only has to prove that the costs were incurred due to an arbitrary and capricious choice of response actions. The court then holds that although EPA notified defendant of its PRP status eight years after the site was listed on the national priorities list, late notification is not an action inconsistent with the NCP or otherwise a defense to recovery. The terms "response" and "remedial action" do not encompass identification and notification of PRPs. The court next holds that EPA's decision to hire a subcontractor to perform the on-site component of the sludge reclamation process was not contrary to the site's interim remedy. At most, the choice of subcontractors resulted in increased costs. And because even unreasonable or excessive costs should not be disallowed so long as the Agency's decision conformed to the NCP, defendant may be charged for the costs attributable to the decision to employ the subcontractor. The court further holds that the United States and Colorado may recoup costs incurred in conducting additional groundwater contamination studies and preparing an explanation of significant differences, which set forth a significantly altered remedy for a surficial aquifer near the site. The NCP does not prohibit conducting additional studies. The court, however, disallows costs attributable to EPA's use of a post-cleanup cancer risk factor of 10<-5> in conducting risk management and remedial design and selection for the final remedy. It was arbitrary and capricious for EPA to assume that cancer risk would remain unchanged following its multimillion dollar sludge removal operation and to mandate cleanup activities on the basis of possible, but highly improbable, land use scenarios. Further, EPA's risk assessment was statistically flawed. The court then holds that the amount of contribution required of defendant should be reduced by the percentage of the total response costs paid by prior settling PRPs that are attributable to the western portion of the site.

[A prior decision in this case is published at 25 ELR 20462.]

Counsel for Plaintiff
Stephen Taylor, Ass't U.S. Attorney
U.S. Attorney's Office
1961 Stout St., Rm. 1200, Denver CO 80294
(303) 844-2081

Counsel for Defendants
Gary E. Parish
LeBoeuf, Lamb, Greene & MacRae
633 17th St., Ste. 2000, Denver CO 80202
(303) 291-2600