ELR Citation: ELR 21244
No(s). J-C-87-291 (E.D. Ark. Mar 27, 1992)

The court holds that an oil refining company and two owners of the company are liable under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) for costs of cleanups conducted on a site leased by the company under Federal Water Pollution Control Act (FWPCA) §311 and CERCLA. The court first holds that the cost recovery action is not barred by res judicata or collateral estoppel even though the site has been the subject of two previous lawsuits. In an FWPCA citizen suit brought by the owner of the site, a declaratory judgment was entered against the tenant refining company making the company liable for cleanup of pollution resulting from the company's activities during the 10-year lease period. The court notes that the previous judgment does not contain the basis for the verdict, and at most the previous verdict concerns only the company owners' obligations under the FWPCA and their obligations under the lease. These obligations are not at issue in the current suit, and nothing in the previous suit precludes the U.S. Environmental Protection Agency's (EPA's) current CERCLA response cost recovery action. The landowner and the oil refining company were found jointly and severally liable in a 1983 action brought by the United States to recover costs of an oil spill cleanup. However, the court notes that the 1983 suit did not address the current issue of whether a hazardous substance has been released. The court next finds that there was a release of hazardous substances and a threat of release sufficient to establish liability under CERCLA. The court holds that certain cost summary exhibits were properly admitted into evidence and that the defendants had sufficient time to review the underlying documentation of the exhibits. The court finds that the United States properly established that documents on which the cost summaries are based are admissible under the public records exception to the hearsay rule. The court holds that the proposed remedial action is not arbitrary and capricious, even though the Arkansas Department of Pollution Control and Ecology objected to the proposed remedy. The court holds that the state's failure to enter into a cooperative agreement with EPA does not bar EPA's recovery of costs from the defendants. The court notes that EPA, following CERCLA's mandate, developed a plan to deal with the site, and the state's opposition to the plan does not warrant a finding that EPA's actions are arbitrary and capricious. The court finds that the costs of the proposed remedial plan are consistent with the national contingency plan, and that the defendants are liable for all of the costs incurred by the government, including attorney fees. Finally, the court holds the refining company and the individual owners liable for future response costs at the site.

Counsel for Plaintiff
A. Douglas Chavis III, Ass't U.S. Attorney
U.S. Attorney's Office
600 W. Capitol, Rm. 331, Little Rock AR 72201
(501) 324-5342

Counsel for Defendants
Bob Lawson Jr.
Lincoln & Lawson
212 Center St., Ste. 200, Little Rock AR 72201
(501) 376-7200