ELR Citation: ELR 20651
No(s). s. S-91-768 MLS, -1167 MLS (E.D. Cal. Sep 21, 1992)

The court holds that the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) §101(14)(C) exempts certain mining wastes (Bevill wastes) from its definition of "hazardous substance" even if such wastes fall within other subdivisions of CERCLA §101(14)'s definition. The court also rules that CERCLA bars assertion of equitable defenses other than those set forth in CERCLA §107(b) and that the United States may assert joint and several liability against a defendant even when the government is also liable, since the defendant may bring claims for contribution.

In these consolidated cases, the United States and California bring cost recovery actions under CERCLA §107(a) concerning Iron Mountain Mine in Redding, California. The site was mined for 100 years, allegedly causing acid mine drainage that threatens the environment. The court first holds that the plaintiff's complaints, which allege that one defendant is a successor in interest to a party that mined the site for several decades and that two other defendants are present owners of the site, state formally sufficient claims for relief under CERCLA, since they allege the elements of CERCLA liability. The court holds that the plaintiff's allegations of releases "at or from" a facility are sufficient.

The court next holds that certain mining wastes are exempt from CERCLA's definition of "hazardous substance," noting that the Bevill Amendment to the Resource Conservation and Recovery Act (RCRA) excludes such wastes from RCRA's regulation, and that CERCLA §101(14)(C) incorporates the Bevill exclusion when defining "hazardous substance." The court rejects the reasoning of the leading case, Eagle-Pitcher Industries, Inc. v. U.S. Environmental Protection Agency, 15 ELR 20460, (D.C. Cir. 1985), which limited the Bevill exclusion to subdivision (C) of CERCLA's definition of "hazardous substance" so that Bevill wastes would be subject to CERCLA if they fell within another subdivision. The court reasons that CERCLA should not be read to render its incorporation of the Bevill exclusion inoperative; the Bevill exclusion's placement in subdivision (C) of the definition of hazardous waste is sensible; and to effectuate the exclusion regardless of its placement comports with legislative history.

The court grants summary judgment to the United States on the defense that response costs resulted from federally permitted releases. Recovery of costs responding to a federally permitted release is prevented only where the defendant proves that the injury from the federally permitted relief is divisible from injury from any nonfederally permitted releases. The defendant failed to offer evidence of divisibility.

The court rejects the argument that CERCLA's incorporation of RCRA's definition of "disposal" limits that definition to materials that are hazardous waste under RCRA. The court notes that the Ninth Circuit, in 3550 Stevens Creek Ass'n v. Barclays Bank, 21 ELR 20011, (9th Cir. 1990), cert. denied, 111 S. Ct. 2014 (1991), limited CERCLA §107(a)(2)'s reach to hazardous and solid wastes since CERCLA §101(29) incorporates RCRA's definition of "disposal" and that definition refers to "solid waste or hazardous waste."

The court rejects the defense of failure to mitigate damages, noting that the defendant neither suggests nor offers evidence of government misfeasance or delay. The court rejects the defense that response costs were unnecessary since governments have generally been allowed to recover all response costs permitted by CERCLA. The court rejects the defenses of deprivation of procedural and substantive due process, since CERCLA's remedy selection process comports with due process and the retroactive reach of CERCLA is justified by a rational legislative purpose. The court rejects equal protection challenges to CERCLA, rejects a defense that CERCLA is an ex post facto law and rejects the defense that CERCLA works an unconstitutional taking of property.

The court holds that CERCLA precludes assertion of equitable defenses that are not listed in §107(b). Moreover, defenses of waiver, estoppel, and unclean hands may not be asserted against sovereigns who act to protect the public welfare. The court also rejects a defense based on the liability of the U.S. Bureau of Reclamation, holding that CERCLA §113 permits the defendants to seek contribution during or after CERCLA §107's action. Other defenses alleging that the United States caused the injury are subsumed by CERCLA §107(b)(3)'s defense for releases and damages caused solely by a third party. Summary judgment as to certain defenses is premature until the question of the U.S.' liability is litigated.

The court rejects the defense of assumption of risk, holding it is not a valid defense to a CERCLA cost recovery action. The court rejects the argument that CERCLA does not apply to releases of naturally occurring substances, since the defendant offers no evidence to dispute that the acid mine drainage at issue exceeds natural levels and no evidence of any harm from naturally occurring acid mine drainage. The court rejects a defendant's argument that mines are not "facilities" under CERCLA §101(9), relying on the breadth of the statutory definition. The court declines to grant summary judgment on a defendant's denial that it is a covered person under CERCLA since the issue turns on proof of facts. The court rejects the argument that hazardous releases must exceed required minimum standards to give rise to liability and notes that standards are exceeded in this case. The court holds that preenactment and prelisting response costs are recoverable.

The court declines to dismiss two defendants' recoupment claims, for damages to the defendants' property caused by the response action, but strikes their set-off claims without objection. By filing a lawsuit, the United States waives sovereign immunity for recoupment claims arising from the same transaction or occurrence that is the subject of the suit. The court holds that tort damages related to the response action are logically related to the U.S.' response action and thus arise from the same transaction or occurrence. The court rejects the argument that owners or operators must have disposed of waste at the facility to be liable. The court declines to strike a defense to allow two defendants to challenge whether particular costs are response costs. Their defense to joint and several liability, that any harm is divisible, raises a factual question that cannot be resolved on a motion to strike. Finally, the court declines to strike a defense that denies that there is no present release.

Counsel for Plaintiff
Michael Hingerty
EPA Region 9
Office of Regional Counsel
75 Hawthorne St., San Francisco CA 94105
(415) 744-1315

Counsel for Defendants
Bruce H. Jackson
Baker & McKenzie
Two Embarcadero Ctr., 24th Fl., San Francisco CA 94111
(415) 576-3000