Presenting a live 90 ‐ minute webinar with interactive Q&A PRP Contribution Claims Under CERCLA Strategies for Cost Recovery Against Other Potentially Responsible Parties TUES DAY, S EPTEMBER 13, 2011 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific T d Today’s faculty features: ’ f l f Glenn A. Harris, Partner, Ballard Spahr , Cherry Hill, N.J. enior Counsel, Morgan Lewis & Bockius , Washington, D.C. Michael W. S teinberg, S The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .
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Glenn A. Harris, Esq. Michael W. Steinberg, Esq. B l Ball B ll llar ard d Spa d S S pahr h h Morgan M M organ L Lew L L ewis i harrisg@ballardspahr.com msteinberg@morganlewis.com 856-761-3440 (202) 739-5141
OVER ERVIEW VIEW Slide Slide No. No. I. I I Contribution Claims Contribution Contribution Claims Contribution Claims Claims 7 *Their *Their Varieties, rieties, Availability ailability, Pr Pros os and and Cons ons II. II. Recent Case La cent Case Law w De Developments lopments 33 33 *Cour *Courts “Directing s “Directing Traf affic” t c” to Either § Either § 107 or or § 113 III. III. Discussion Discussion of of Current Current Issues Issues 76 76 IV IV IV IV. Question Question and Question-and Question and-Answ and Answ Answer Answer er Session er Session Session Session 77 77 77 77 6
Ho How impor w important is contribution? ant is contribution? “Contribution Contribution Contribution Contribution” as used here means any legal theory as used here means any legal theory by which a PRP recovers cleanup costs from other PRPs Important to PRPs as the primary defense against unfairness of joint and several liability to EPA Other tools to mitigate unfairness have not been Oth t l t itig t f i h t b widely available or highly effective: Divisibility of harm (although this is in flux after Divisibility of harm (although this is in flux after Burlington Northern ) Mixed funding EPA orphan share funding policy 7
Ho How im w impor p ortant is contribution? tant is contribution? (cont’d) (cont’d) Important to EPA because contribution is essential Important to EPA because contribution is essential to achieve settlements that will maintain the historic high rate (~70%) of PRP-lead cleanups Especially important now as EPA has no budget to perform cleanups except at orphan sites So EPA and the PRPs have a shared interest in an S EPA d th PRP h h d i t t i effective contribution framework But don’t assume that EPA will help you obtain But don t assume that EPA will help you obtain contribution from other PRPs at your site! 8
Varie rieties of ies of contribution claims contribution claims CERCLA § 107(a) cost recovery CERCLA § 107(a) cost recovery CERCLA § 113(f) contribution following litigation or settlement under §§ 106 or 107 § 113(f)(1) for costs incurred in an action under §§ 106 or 107 § 113 f 3 f § 113(f)(3) for costs incurred in settlements with EPA or a State State law State law Statutory (e.g., New Jersey Spill Act) Common law (e.g., equitable contribution among tortfeasors) 9
Wh Why does it y does it matt matter ho er how w the claim the claim is styled? is styled? Rapidly shifting case law makes this terrain Rapidly shifting case law makes this terrain difficult to navigate For example, 2 recent decisions by the Second Circuit on the § 107/ § 113 split appear to be directly contradictory In the first case decided in 2009 the court allowed a In the first case, decided in 2009, the court allowed a PRP to bring a § 107 cost recovery claim but not a § 113 contribution claim In the second case, decided in 2010, the court allowed a similarly situated PRP to bring a § 113 contribution claim but not a § 107 cost recovery claim y § 10
Wh Why does it y does it matt matter ho er how w the claim the claim is styled? is styled? (cont’d) (cont’d) W. W.R. G Grace v v. Zotos , , Niagar a Moha Niagar a Mohawk v wk v. Che Chevron ron , , 59 F 59 F.3d 3d 85 (2d 85 (2d Cir ir. . 2009) 2009) 596 F.3d 596 F 3d 11 112 (2d 2 (2d Cir ir. . 20 2010) suit by current owner following suit by former owner following settlement with NY DEC; DEC settlement with NY DEC; DEC consent order obligated d bli d consent orders obligated d bli d plaintiff to perform RI/FS and plaintiff to perform RI/FS and RD/RA; orders released all RD/RA; order released all claims under NY law, but , claims under both CERCLA and made no mention of CERCLA NY law 11
Wh Why does it y does it matt matter ho er how w the claim the claim is styled? is styled? (cont’d) (cont’d) W. W.R. G Grace v v. Zotos , , Niagara Niagara Moha Mohawk v wk v. Che Chevro ron , , 559 F.3d 559 F 3d 85 85 (2d (2d Cir ir. . 2009) 2009) 596 F.3d 596 F 3d 11 112 (2d 2 (2d Cir ir. . 20 2010) § 113 claim allowed because § 113 claim rejected because AOC recites that DEC releases AOC makes no reference to its CERCLA claims against CERCLA; “there is a risk the ; plaintiff upon completion of the EPA will take later actions or work select different remedies that could expose the PRP to [N B : Isn’t there the same risk [N.B.: Isn t there the same risk additional liabilities” additional liabilities” as in Zotos that “EPA will take later actions”?] 12
Why does it Wh y does it matt matter ho er how w the claim the claim is styled? is styled? (cont’d) (cont’d) W R G W R W.R. G G Grace race v. Z t v. Zotos Z t os, Niagar Ni Ni Ni g ara M M h M Mohaw awk k Ch k k v. v. Ch Chev Ch evron , 559 F.3d 559 F 3d 85 85 (2d (2d Cir ir. . 2009) 2009) 596 F 596 F.3d 3d 11 112 (2d 2 (2d Cir ir. . 20 2010) § 107 claim rejected because § 107 claim allowed “even though allowing it “would in effect nullify the its expenditures were made in SARA amendment and abrogate the compliance with a consent order”; requirements Congress placed on requirements Congress placed on because § 107(a) not limited to beca se § 107(a) not limited to contribution claims under § 113” – those who act “voluntarily”; “relevant inquiry . . . is whether [N.B.: Court cites only to the CERCLA [plaintiff acted without] the type of statute of limitations to support the administrative or judicial action that reference to “requirements”] would give rise to a contribution claim under section 113(f)” 13
Why does it Wh y does it matt matter ho er how w the claim the claim is styled? is styled? (cont’d) (cont’d) Some legal theories are inherently more favorable Some legal theories are inherently more favorable to the plaintiff than others Many worthy claims founder on procedural issues, e.g., a statute of limitations problem that no one anticipated EPA/DOJ involvement in private-party litigation can EPA/DOJ i l t i i t t litig ti be a “wild card” EPA/DOJ often seeks to block § 107 claims against EPA/DOJ often seeks to block § 107 claims against settling PRPs Yet EPA/DOJ refuses to confer such protection up front i in settlement agreements ttl t gr t 14
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