Beazer East, Inc. v. Mead Corporation

525 F.3d 255, 38 Envtl. L. Rep. (Envtl. Law Inst.) 20114, 66 ERC (BNA) 1577, 2008 U.S. App. LEXIS 10270, 2008 WL 2024982
CourtCourt of Appeals for the Third Circuit
DecidedMay 13, 2008
Docket06-4993
StatusPublished
Cited by44 cases

This text of 525 F.3d 255 (Beazer East, Inc. v. Mead Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Beazer East, Inc. v. Mead Corporation, 525 F.3d 255, 38 Envtl. L. Rep. (Envtl. Law Inst.) 20114, 66 ERC (BNA) 1577, 2008 U.S. App. LEXIS 10270, 2008 WL 2024982 (3d Cir. 2008).

Opinion

OPINION

WEIS, Circuit Judge.

This is the third appeal in this long-running contribution claim under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), Pub.L. No. 96-510, 94 Stat. 2767. After the second appeal was decided, defendant Mead moved for judgment for failure to state a claim or for lack of subject-matter jurisdiction. The District Court denied the motions, but certified a controlling question of law under 28 U.S.C. § 1292(b) raising the issue of whether the effect of Cooper Indus, v. Aviall Servs., Inc., 543 U.S. 157, 125 S.Ct. 577, 160 L.Ed.2d 548 (2004), is to deny subject-matter jurisdiction over plaintiff Beazer’s contribution claims under § 113(f)(1) of CERCLA, 42 U.S.C. § 9613(f)(1). 1 Also implicated is the denial of Mead’s motion to dismiss for failure to state a claim under § 113(f)(1).

We conclude that the District Court has subject-matter jurisdiction. We will also affirm the denial of the motion for judgment on the pleadings and will remand for further proceedings.

I.

We will summarize the progress of this litigation to the extent that it is pertinent to the pending appeal. Beazer’s predecessor in title purchased property previously owned by Mead. After federal and state investigations revealed the existence of hazardous wastes at the site, Beazer entered into a 1991 Administrative Order on Consent with the United States Environmental Protection Agency under the Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C. § 6901 et seq. After Mead declined to participate in the investigation and cleanup of the site, Beazer began a lengthy and continuing remediation process.

In early 1991, Beazer filed a complaint against Mead seeking contribution for investigation and cleanup costs under §§ 107(a) 2 and 113(f)(1) of CERCLA, 42 U.S.C. §§ 9607(a), 9613(f)(1), as well as asserting various state and common law claims. Mead counterclaimed based on an indemnity provision in the original purchase agreement.

The District Court granted summary judgment to Mead, but on appeal we reversed, holding that the purchase agreement did not require indemnification. Beazer East, Inc. v. Mead Corp., 34 F.3d 206, 208 (3d Cir.1994) (Beazer I). The case was remanded so that the District Court could “consider both parties’ contribution claims, and determine the proper apportionment of CERCLA liability.” Id. at 209.

*258 On remand, Mead argued, inter alia, that Beazer could not recover most of its costs under § 113(f)(1) because they were incurred under the RCRA 3 rather than CERCLA. Moreover, the costs could not be obtained under § 107(a) because they were not voluntarily incurred.

In 1996, the District Court determined that Beazer’s §§ 107 and 113(f) claims were duplicative. It dismissed the § 107 claim, stating, “Beazer has failed to identify any additional bases for recovery or damages under a § 9706 [§ 107] claim which would not be included in a final allocation of the parties’ contribution claims under § 9613(f) [§ 113(f) ].” 4

The District Court also concluded, “[t]o the extent that the motion seeks to preclude Beazer from advancing its § [113(f) ] action on the bases that Beazer’s response costs were incurred on a voluntary nature or were incurred under the Resource Conservation Recovery Act, 42 U.S.C. § 6901 et seq., the motion is likewise denied.”

The Court then referred the case to a magistrate judge to allocate costs between Mead and Beazer. At that time, neither of the parties sought reconsideration of the District Court’s rulings on the viability of the § 107 and § 113(f)(1) claims.

After conclusion of the magistrate’s allocation proceedings, the district judge modified the magistrate’s recommendations and, following a bench trial, assessed Mead with 67.5% and Beazer with 32.5% liability. In August 2002, the Court entered judgment against Mead in the amount of $3,243,467.80 plus interest. The Court also entered a declaratory judgment in October 2002 requiring Mead to pay 67.5% of Beazer’s continuing costs.

Mead appealed, contending that in the absence of its consent the magistrate judge lacked authority to conduct a fact-finding trial. Mead did not challenge its liability for contribution under § 113(f)(1), nor did Beazer discuss whether it had a claim for contribution under § 107.

In June 2005, this Court decided that the magistrate judge lacked authority to conduct the allocation proceeding. Beazer East, Inc. v. Mead Corp., 412 F.3d 429, 432 (3d Cir.2005) (Beazer II). We remanded “for a new equitable allocation proceeding before the District Judge,” id., and commented on factors to be considered in the apportionment, but made no ruling on the liability of the parties. Id. at 445-49.

In December 2004, after Beazer II was argued, the Supreme Court decided Cooper. Essentially, that case held that a party “who has not been sued under § 106 or § 107(a) ... [cannot] obtain contribution under § 113(f)(1) from other liable parties.” 543 U.S. at 161, 125 S.Ct. 577.

In June 2005, we filed the opinion in Beazer II and returned the case to the District Court. Six months later, in January 2006, Mead filed a motion for judgment on the pleadings, asserting that Beazer could not maintain its claim for contribution pursuant to § 113(f)(1) because of the Cooper decision. In a later filing, Mead argued that Cooper deprived the District Court of subject-matter jurisdiction because Beazer had not been sued under § 106 or § 107.

The District Court denied the motion, ruling that the requirement for a suit under § 106 or § 107 was an element of a claim for relief under § 113(f)(1) and not a jurisdictional threshold. The Court also *259 noted that Mead had waived its non-jurisdictional defense to the § 113(f)(1) claim by failing to raise the issue on its appeal in Beazer II.

Mead then filed this interlocutory appeal. After it was docketed and the briefs were filed, but before oral argument, the Supreme Court decided United States v. Atlantic Research Corp. ,—U.S.-, 127 S.Ct.

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525 F.3d 255, 38 Envtl. L. Rep. (Envtl. Law Inst.) 20114, 66 ERC (BNA) 1577, 2008 U.S. App. LEXIS 10270, 2008 WL 2024982, Counsel Stack Legal Research, https://law.counselstack.com/opinion/beazer-east-inc-v-mead-corporation-ca3-2008.