ELR Citation: ELR 20319
No(s). 88-2074 (6th Cir. Nov 20, 1989)

The court holds that the government may recover indirect costs in a Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) cost recovery action. The court holds that the challenged indirect costs are part of "all costs" of removal or remedial actions recoverable under CERCLA §107(a). Congress' intent that the government recover all costs incurred in a remedial or removal action, coupled with the broad remedial purpose of CERCLA, supports a liberal interpretation of recoverable costs. The court further observes that the challenged indirect costs, which include office space, administrative, and other overhead expenses of Environmental Protection Agency (EPA) employees at EPA headquarters and the 10 regional EPA offices that oversee response actions, represent a proportionate share of the regional costs incurred in support of this removal action. The court holds that summary judgment was properly granted to the government on the issue of indirect costs, since the government presented documents supporting its calculation of indirect costs and defendant failed to seek discovery or otherwise acquire evidence to support its claim that a genuine issue of material fact existed as to calculating indirect costs.

The court holds that applying CERCLA, as amended by the Superfund Amendments and Reauthorization Act (SARA), retroactively to allow the government to recover prejudgment interest is not contrary to congressional intent. SARA took effect approximately six months prior to the district court's award of prejudgment interest, but after the removal action was undertaken by the government and the commencement of this suit. The court notes that Congress gave no clear indication as to whether SARA should be applied retroactively, but holds that SARA is retroactively applicable, since SARA was intended to revitalize the Superfund program and CERCLA has retroactive application. Finally, the court holds that defendant was correctly assigned joint and several liability for the costs, since the environmental harm created by the conditions on defendant's property was indivisible. To the extent the defendant can demonstrate the divisibility of the harm and that it paid more than its fair share, it will be entitled to relief in its action for contribution against the other defendants.

Counsel for Plaintiff-Appellee
Thomas Gezon, Ass't U.S. Attorney
399 Federal Bldg., 1110 Michigan Ave. NW, Grand Rapids MI 49503
(616) 456-2404

Counsel for Defendant-Appellant
John Van Ploeg
Smith, Haughey, Rice & Roegge
200 Calder Plaza Bldg., Grand Rapids MI 49503
(616) 774-8000

Before: GUY, BOGGS, and NORRIS, Circuit Judges.