NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JUN 12 2025 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
MORELAND PROPERTIES LLC, a No. 24-2451 Colorado Limited Liability Company, D.C. No. 2:20-cv-02297-SRB Plaintiff - Appellant, MEMORANDUM* v.
GOODYEAR TIRE & RUBBER COMPANY, named as The Goodyear Tire & Rubber Company, an Ohio Corporation; GOODYEAR FARMS INCORPORATED, an Arizona Corporation,
Defendants - Appellees.
Appeal from the United States District Court for the District of Arizona Susan R. Bolton, District Judge, Presiding
Argued and Submitted March 26, 2025 Submission Withdrawn April 8, 2025 Resubmitted June 10, 2025 Phoenix, Arizona
Before: GRABER, BERZON, and BENNETT, Circuit Judges.
Plaintiff Moreland Properties, LLC (“Moreland”) appeals (1) the district
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3.
1 court’s grant of summary judgment for Defendants Goodyear Farms, Inc. and the
Goodyear Tire and Rubber Company (collectively, “Goodyear”) on Moreland’s
fraud claim and (2) the district court’s judgment for Goodyear following a bench
trial on Moreland’s Comprehensive Environmental Response, Compensation, and
Liability Act (“CERCLA”) claim. We affirm on both issues.
1. The district court correctly concluded that Moreland’s fraud claim was time
barred. Arizona applies a three-year limitations period to fraud claims. Ariz. Rev.
Stat. § 12-543(3). The statute of limitations does not begin to run “until the discovery
by the aggrieved party of the facts constituting the fraud or mistake.” Id. Discovery
occurs at the point “when the defrauded party discovers or with reasonable diligence
could have discovered the fraud.” Mister Donut of Am., Inc. v. Harris, 723 P.2d 670,
672 (Ariz. 1986). Because a claim accrues when a reasonably diligent party would
have discovered it, this discovery rule includes a corollary “duty to investigate.” Doe
v. Roe, 955 P.2d 951, 962 (Ariz. 1998); Walk v. Ring, 44 P.3d 990, 994 (Ariz. 2002).
As a result, the statute of limitations “may begin to run before a person has actual
knowledge of the fraud or even all the underlying details of the alleged fraud.” Mister
Donut, 723 P.2d at 672; see also Coronado Dev. Corp. v. Superior Ct. of Ariz. ex
rel. County of Cochise, 678 P.2d 535, 537 (Ariz. Ct. App. 1984).
The report from Western Technologies Inc. (“WTI”) in January 2015 showed
an average arsenic concentration of around 50 mg/kg. Goodyear’s 2004 Declaration
2 of Environmental Use Restriction (“DEUR”) had reported a 95% upper confidence
limit mean arsenic concentration of only 10 mg/kg. The WTI report’s findings were
sufficiently alarming that the prospective buyer to whom Moreland had intended to
sell the land withdrew from the sale, and Moreland initiated remediation efforts.
Further, William Moreland testified that he understood the WTI report to mean that
“the property is not as stated in the DEUR” and that, as a result, “I couldn’t sell it
saying there’s a DEUR as I bought it. And this DEUR is misrepresented or it’s
fraudulent. I couldn’t do it.” The WTI report therefore put a reasonable person on
notice that fraud may have occurred and that an investigation was called for.
That scienter is one of the facts constituting fraud, see Merck & Co. v.
Reynolds, 559 U.S. 633, 648-49 (2010), does not affect the date at which a
reasonably diligent plaintiff in Moreland’s position would have begun investigating.
The WTI report’s finding of extremely elevated arsenic levels was sufficient to put
a reasonable person on notice to investigate whether Goodyear knowingly
misrepresented the concentrations in the DEUR, even though the report did not
address that issue.
When Moreland did investigate the reason for the inconsistency between its
sampling and the DEUR, it took approximately one month for it to discover that
Goodyear allegedly had not “take[n] sufficient pre- and post-confirmation arsenic
samples” to “delineate, confirm, or further excavate the areas of arsenic impacted
3 soil,” even though it was required to do so by the work plan approved by the Arizona
Department of Environmental Quality (“ADEQ”). It is these findings on which
Moreland relied to allege both the falsity of the DEUR and scienter. Had Moreland
acted as a reasonably diligent plaintiff would have and begun investigating the basis
for the arsenic inconsistency after receiving the WTI report, it would have
discovered the facts constituting fraud—including those suggesting scienter—in
early 2015. Because Moreland filed suit on November 30, 2020, more than three
years later, its fraud claim is barred by the statute of limitations.
2. The district court correctly found for Goodyear on Moreland’s CERCLA
claim. To recover, Moreland had to show that its response action was “consistent
with” the National Contingency Plan (“NCP”). Carson Harbor Vill., Ltd. v. County
of Los Angeles, 433 F.3d 1260, 1265 (9th Cir. 2006); see 42 U.S.C. § 9607(a)(4)(B).
“A private party response action will be considered ‘consistent with the NCP’ if the
action, when evaluated as a whole, is in substantial compliance with the applicable
requirements. . . .” 40 C.F.R. § 300.700(c)(3)(i).
A. “CERCLA and the National Contingency Plan divide response actions into
two broad categories: removal actions and remedial actions.” United States v. W.R.
Grace & Co., 429 F.3d 1224, 1227 (9th Cir. 2005); see also 42 U.S.C. § 9601(23),
(24). “[B]oth types of actions have substantial requirements, but the [NCP’s]
requirements for remedial actions are much more detailed and onerous.” W.R.
4 Grace, 429 F.3d at 1228 (citation omitted). “[R]emoval actions encompass interim,
partial time-sensitive responses taken to counter serious threats to public health.” Id.
at 1245; see also Santa Clarita Valley Water Agency v. Whittaker Corp., 99 F.4th
458, 478 (9th Cir. 2024). “Remedial actions, on the other hand, are often described
as permanent remedies to threats for which an urgent response is not warranted.”
W.R. Grace, 429 F.3d at 1228 (footnote omitted); see also Santa Clarita, 99 F.4th at
478.
The district court properly characterized Moreland’s response as a remedial
action. Moreland’s response did not address a time-sensitive public health threat,
because there was “no evidence that the elevated arsenic or toxaphene
concentrations in the soil required ‘immediate attention.’” The only evidence of risk
Moreland provided was that the degree of arsenic contamination on the land
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NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JUN 12 2025 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
MORELAND PROPERTIES LLC, a No. 24-2451 Colorado Limited Liability Company, D.C. No. 2:20-cv-02297-SRB Plaintiff - Appellant, MEMORANDUM* v.
GOODYEAR TIRE & RUBBER COMPANY, named as The Goodyear Tire & Rubber Company, an Ohio Corporation; GOODYEAR FARMS INCORPORATED, an Arizona Corporation,
Defendants - Appellees.
Appeal from the United States District Court for the District of Arizona Susan R. Bolton, District Judge, Presiding
Argued and Submitted March 26, 2025 Submission Withdrawn April 8, 2025 Resubmitted June 10, 2025 Phoenix, Arizona
Before: GRABER, BERZON, and BENNETT, Circuit Judges.
Plaintiff Moreland Properties, LLC (“Moreland”) appeals (1) the district
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3.
1 court’s grant of summary judgment for Defendants Goodyear Farms, Inc. and the
Goodyear Tire and Rubber Company (collectively, “Goodyear”) on Moreland’s
fraud claim and (2) the district court’s judgment for Goodyear following a bench
trial on Moreland’s Comprehensive Environmental Response, Compensation, and
Liability Act (“CERCLA”) claim. We affirm on both issues.
1. The district court correctly concluded that Moreland’s fraud claim was time
barred. Arizona applies a three-year limitations period to fraud claims. Ariz. Rev.
Stat. § 12-543(3). The statute of limitations does not begin to run “until the discovery
by the aggrieved party of the facts constituting the fraud or mistake.” Id. Discovery
occurs at the point “when the defrauded party discovers or with reasonable diligence
could have discovered the fraud.” Mister Donut of Am., Inc. v. Harris, 723 P.2d 670,
672 (Ariz. 1986). Because a claim accrues when a reasonably diligent party would
have discovered it, this discovery rule includes a corollary “duty to investigate.” Doe
v. Roe, 955 P.2d 951, 962 (Ariz. 1998); Walk v. Ring, 44 P.3d 990, 994 (Ariz. 2002).
As a result, the statute of limitations “may begin to run before a person has actual
knowledge of the fraud or even all the underlying details of the alleged fraud.” Mister
Donut, 723 P.2d at 672; see also Coronado Dev. Corp. v. Superior Ct. of Ariz. ex
rel. County of Cochise, 678 P.2d 535, 537 (Ariz. Ct. App. 1984).
The report from Western Technologies Inc. (“WTI”) in January 2015 showed
an average arsenic concentration of around 50 mg/kg. Goodyear’s 2004 Declaration
2 of Environmental Use Restriction (“DEUR”) had reported a 95% upper confidence
limit mean arsenic concentration of only 10 mg/kg. The WTI report’s findings were
sufficiently alarming that the prospective buyer to whom Moreland had intended to
sell the land withdrew from the sale, and Moreland initiated remediation efforts.
Further, William Moreland testified that he understood the WTI report to mean that
“the property is not as stated in the DEUR” and that, as a result, “I couldn’t sell it
saying there’s a DEUR as I bought it. And this DEUR is misrepresented or it’s
fraudulent. I couldn’t do it.” The WTI report therefore put a reasonable person on
notice that fraud may have occurred and that an investigation was called for.
That scienter is one of the facts constituting fraud, see Merck & Co. v.
Reynolds, 559 U.S. 633, 648-49 (2010), does not affect the date at which a
reasonably diligent plaintiff in Moreland’s position would have begun investigating.
The WTI report’s finding of extremely elevated arsenic levels was sufficient to put
a reasonable person on notice to investigate whether Goodyear knowingly
misrepresented the concentrations in the DEUR, even though the report did not
address that issue.
When Moreland did investigate the reason for the inconsistency between its
sampling and the DEUR, it took approximately one month for it to discover that
Goodyear allegedly had not “take[n] sufficient pre- and post-confirmation arsenic
samples” to “delineate, confirm, or further excavate the areas of arsenic impacted
3 soil,” even though it was required to do so by the work plan approved by the Arizona
Department of Environmental Quality (“ADEQ”). It is these findings on which
Moreland relied to allege both the falsity of the DEUR and scienter. Had Moreland
acted as a reasonably diligent plaintiff would have and begun investigating the basis
for the arsenic inconsistency after receiving the WTI report, it would have
discovered the facts constituting fraud—including those suggesting scienter—in
early 2015. Because Moreland filed suit on November 30, 2020, more than three
years later, its fraud claim is barred by the statute of limitations.
2. The district court correctly found for Goodyear on Moreland’s CERCLA
claim. To recover, Moreland had to show that its response action was “consistent
with” the National Contingency Plan (“NCP”). Carson Harbor Vill., Ltd. v. County
of Los Angeles, 433 F.3d 1260, 1265 (9th Cir. 2006); see 42 U.S.C. § 9607(a)(4)(B).
“A private party response action will be considered ‘consistent with the NCP’ if the
action, when evaluated as a whole, is in substantial compliance with the applicable
requirements. . . .” 40 C.F.R. § 300.700(c)(3)(i).
A. “CERCLA and the National Contingency Plan divide response actions into
two broad categories: removal actions and remedial actions.” United States v. W.R.
Grace & Co., 429 F.3d 1224, 1227 (9th Cir. 2005); see also 42 U.S.C. § 9601(23),
(24). “[B]oth types of actions have substantial requirements, but the [NCP’s]
requirements for remedial actions are much more detailed and onerous.” W.R.
4 Grace, 429 F.3d at 1228 (citation omitted). “[R]emoval actions encompass interim,
partial time-sensitive responses taken to counter serious threats to public health.” Id.
at 1245; see also Santa Clarita Valley Water Agency v. Whittaker Corp., 99 F.4th
458, 478 (9th Cir. 2024). “Remedial actions, on the other hand, are often described
as permanent remedies to threats for which an urgent response is not warranted.”
W.R. Grace, 429 F.3d at 1228 (footnote omitted); see also Santa Clarita, 99 F.4th at
478.
The district court properly characterized Moreland’s response as a remedial
action. Moreland’s response did not address a time-sensitive public health threat,
because there was “no evidence that the elevated arsenic or toxaphene
concentrations in the soil required ‘immediate attention.’” The only evidence of risk
Moreland provided was that the degree of arsenic contamination on the land
exceeded the applicable Arizona Soil Remediation Level (“SRL”) set by ADEQ;
Moreland presented no evidence that the risk was time-sensitive or substantial
enough to necessitate an immediate response. That the land was a vacant,
undeveloped lot suggests there was minimal risk that someone would come into
contact with the contaminated soil, and there was evidence introduced at trial that
the soil presented no risk of groundwater contamination.
Moreland’s response was also “comprehensive” and “permanent,” not
“interim” or “partial.” W.R. Grace, 429 F.3d at 1228, 1245. By Moreland’s own
5 estimation, the excavation reduced the soil’s arsenic concentration to 9.9 mg/kg and
the toxaphene concentration to 4.9 mg/kg. These values are below the current
residential SRLs, indicating that Moreland’s response “fully eliminate[d] the public
health threat” posed by the contamination. Id. at 1247.
That Moreland’s ADEQ-approved work plan referred to the response as a
“removal” is not pertinent. An ADEQ employee explained during trial that ADEQ’s
approval of Moreland’s work plan involved no substantive determination that
Moreland’s response was a removal action under CERCLA, nor would ADEQ’s
interpretation of CERCLA be entitled to deference. See Arizona v. City of Tucson,
761 F.3d 1005, 1014 (9th Cir. 2014).
Accordingly, Moreland’s response is properly characterized as a remedial
action.
B. Because Moreland’s response was a remedial action, the NCP required,
among other things, that Moreland conduct a feasibility study containing “[a]
detailed analysis” of “alternatives that represent viable approaches to remedial
action.” 40 C.F.R. § 300.430(e)(9)(i). “One of the hallmarks of the feasibility study
requirement is assessing a variety of possible alternatives and providing analysis of
the costs, implementability, and effectiveness of each, and choosing the best
alternative for the site at issue.” Carson Harbor, 433 F.3d at 1268; see also 40 C.F.R.
§ 300.430(e)(9)(iii) (listing criteria that the feasibility study must consider).
6 Moreland has submitted no evidence to show that it conducted the required
feasibility study or otherwise analyzed remedial alternatives. Its work plan
considered only excavation. Its 2017 sampling report likewise did not assess any
remedial alternatives. Although the WTI report noted that “[l]ess expensive
remediation/mitigation alternatives are potentially available,” it did not list those
alternatives, or analyze the costs, effectiveness, or other features of such alternatives,
aside from stating that they “often involve increased agency interaction and
frequently less certainty in the schedule for the project.” Because “discussing a
single remediation alternative does not establish substantial compliance with the
feasibility study requirements of the National Contingency Plan,” these documents
do not suffice. Carson Harbor, 433 F.3d at 1268. The feasibility studies Marsh
Aviation commissioned in the 1990s do not satisfy the NCP’s requirement, as they
addressed only the toxaphene contamination; no remedial options to resolve the
arsenic contamination at issue in Moreland’s remediation were discussed. Further,
because the studies were conducted before Goodyear’s remediation attempt, they did
not accurately characterize the scope of the contamination Moreland confronted or
the relative merits of various remedial options available to Moreland.
In sum, Moreland did not substantially comply with the feasibility study
requirement, so its remediation was inconsistent with the NCP. Because Moreland
is barred from recovering on that ground, we do not consider whether Moreland
7 complied with the NCP’s public participation requirement or whether its response
costs were necessary.
AFFIRMED.