ELR Citation: ELR 20119
No(s). CIV-88-542C (W.D.N.Y. Aug 8, 1989)

The court holds that summary judgment is inappropriate in a settlement agreement for Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) response costs because the government raises genuine issues of material fact as to a 49 percent shareholder's involvement in company management in disposal of hazardous materials, and because a partial consent decree for recovery of approximately 83 percent of CERCLA response costs at the hazardous waste site is reasonable. The government raises disputed factual issues requiring additional discovery that might support either direct or derivative CERCLA liability. Evidence about the shareholder's actual participation in the day-to-day company operations, including providing technical expertise about manufacturing processes, may allow the court to find the shareholder responsible under CERCLA §9607(a)(2) and should not be disregarded merely because of the percentage of shares owned. The partial consent decree for 83 percent of past and future cleanup costs is a reasonable percentage to be arrived at by settlement, without the need for protracted and expensive litigation, and is in line with the intent of CERCLA. The shareholder's choice to forego negotiations in favor of litigation should not be allowed to endanger the remedial and reimbursement program hammered out among the settling parties.

Counsel for Plaintiff
Jerry Schwartz
Land and Natural Resources Division, U.S. Department of Justice
P.O. Box 7611 Ben Franklin Station, Washington DC 20044
(202) 633-4624

Counsel for Defendant
Charles K. O'Neill
Chadbourne & Park
30 Rockefeller Plaza, New York NY 10112
(212) 408-5100