ELR Citation: ELR 20486
No(s). s. 93-2699, -2702 (8th Cir. Dec 28, 1994)

The court holds that res judicata bars a Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) cost recovery action that the U.S. Environmental Protection Agency (EPA) brought against a refining company that EPA previously sued under the Federal Water Pollution Control Act (FWPCA) concerning the same contamination. The court first holds that an individual who claimed to be "merely an employee" of the company is liable under CERCLA §107(a)(2) as an "operator." He had authority to determine the company's hazardous waste disposal activities and actually exercised that authority. The court next holds the court's holding in United States v. Northeastern Pharmaceutical & Chemical Co., 17 ELR 20603 (8th Cir. 1986), that CERCLA was intended to apply retroactively and that such retroactive application does not violate the Due Process Clause of the U.S. Constitution, forecloses the individual's argument that the imposition of liability for conduct that preceded CERCLA's effective date violates due process. The court next holds that res judicata precludes EPA from bringing this cost recovery action against the company because EPA's prior FWPCA action against the company involved the same cause of action. The two actions focused on the same underlying facts; are closely related in time, space, and origin; and form a convenient trial unit. Also, although EPA may bring one CERCLA action after another CERCLA action, under CERCLA §113(g)(2), the Agency may not pursue both an FWPCA action and a CERCLA action to right the same wrong. The court holds, however, that EPA is not precluded from bringing the cost recovery action against the company's president and the employee individually. They were neither parties to the prior FWPCA action nor in privity with the company. The court next holds that the doctrine of collateral estoppel does not prevent EPA from proving the necessary elements of the company's and the individuals' liability. The issues in the present case are not identical to the issues in the prior case. The court also holds that the waste appellants disposed of rerefining wastes that consisted of oil, clay, barium, lead, zinc, polychlorinated biphenyls, and sulfuric acid. The court next holds that EPA may recover its attorneys fees that were associated with identifying potential parties, because they were a necessary part of EPA's legitimate enforcement activities and not related to EPA's status as a prevailing party in this action.

Counsel for Plaintiff
Arthur D. Chavis III, Ass't U.S. Attorney
U.S. Attorney's Office
450 W. Capitol Ave., Ste. 500
P.O. Box 1229, Little Rock AR 72201
(501) 378-5221

Counsel for Defendant
David A. Gates
Mitchell, Williams, Selig, Gates & Woodyard
320 W. Capitol Ave., Ste. 1000, Little Rock AR 72201
(501) 688-8800

Before Gibson and Kopf,^* JJ.