United States v. Davis

11 F. Supp. 2d 183, 47 ERC (BNA) 1090, 1998 U.S. Dist. LEXIS 10681, 1998 WL 394316
District Court, D. Rhode Island·Decided July 13, 1998·No. C.A. 90-484·Published·Cited by 14 cases

Opinion

MEMORANDUM AND ORDER

TORRES, District Judge.

The United States commenced this action, pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9601 et seq.t to recover response costs associated with remediating a hazardous waste site. The original defendants were United Technologies Corp. (“UTC”) and eight other potentially responsible parties (“PRP’s”). The United States has moved for entry of a partial consent decree resolving all claims against UTC and forty-seven of the 138 third and fourth-party defendants against whom UTC has asserted claims for contribution. 1

*186 The ultimate issue presented is whether the proposed settlement is fair, reasonable and consistent with the objectives of CERC-LA. A narrower sub-issue, and one that no court yet has addressed, is whether the public can be adequately compensated by a settlement in which the United States receives only a portion of the remediation cost from a party previously adjudged liable for the entire cost. Because I answer both questions in the affirmative, the motion to enter the consent decree is granted.

Background

During the 1970’s, a considerable quantity of hazardous waste was dumped at a waste disposal facility in Smithfield, Rhode Island, owned and operated by William M. Davis and his wife, Eleanor Davis (the “Site” or the “Davis Site”).

In 1990, the United States commenced this action against the Davises;. Capuano Brothers, Inc., and United Sanitation, Inc., two companies that allegedly transported hazardous wastes to the Site; and Ciba-Geigy Corp. (“Ciba-Geigy”), Clairol, Inc. (“Clairol”), Pfizer, Inc. (“Pfizer”), The Providence Journal Co. (“The Providence Journal”), and UTC, companies that allegedly generated the wastes. Specifically, the United States sought recovery, pursuant to § 107 of CERCLA, 42 U.S.C. § 9607(a), for remediation and enforcement costs already incurred and for a declaratory judgment, pursuant to 113(g)(2) of CERCLA, 42 U.S.C. § 9613(g)(2), holding the defendants jointly and severally liable for all future response costs.

The response costs were projected to be approximately $55 million and included estimates of $14 million for soil remediation; $13 million for groundwater cleanup and over $3 million for extending a water line to supply nearby residents whose wells had been contaminated.

The case was assigned to Judge Pettine and was transferred to me on August 1,1997, shortly after Judge Pettine took senior inactive status.

In February of 1993, UTC and several other defendants impleaded 124 third-party defendants in an effort to obtain contribution, pursuant to § 113(f) of CERCLA, 42 U.S.C. § 9613(f), with respect to any amounts for which the original defendants were held liable to the United States. Several third-party defendants, in turn, impleaded twenty-two fourth-party defendants and UTC has asserted direct claims for contribution against most of them. 2

In addition to its claims for contribution, UTC seeks a declaratory judgment allocating responsibility among all parties. The United States has not asserted claims against any of the third or fourth-party defendants.

Judge Pettine trifurcated the case into three separate phases. Phase I was limited to determining the nine original defendants, liability for response costs. Phase II was to establish the amount of response costs incurred by the United States and Phase III was to deal with all remaining claims, including claims for contribution, indemnification and/or allocation of responsibility.

Prior to the Phase I trial, Judge Pettine entered partial consent decrees formalizing settlements of the United States, claims against Ciba-Geigy, Clairol, Pfizer and The Providence' Journal. Pursuant to those agreements, the settling defendants paid a total of approximately $5.8 million to the government. 3

The case against UTC proceeded to trial; but, for reasons' that are not entirely clear, the claims against the other non-settling defendants were held in abeyance. On May 4, 1995, Judge Pettine adjudged UTC jointly and severally liable for all past and future costs at the Davis Site. See United States v. Davis, 882 F.Supp. 1217 (D.R.I.1995); United States v. Davis, C.A. No. 90-484 (D.R.I. *187 May 4,1995) (order for declaratory judgment of UTC’s liability for response costs).

While preserving its right to appeal that judgment, UTC stipulated with the government that the response costs incurred by the Environmental Protection Agency (“EPA”) prior to September 30,1987, and the enforcement costs incurred by the Department of Justice (“DOJ”) prior to September 30, 1994, totaled $9.1 million. 4 The amount of UTC’s liability for costs incurred after those dates was left for future determination. The United States and UTC further stipulated that the $5.8 million paid by the four defendants who previously settled would be deducted from the response costs for which UTC would be liable. Those stipulations eliminated the need for a Phase II trial.

The case then proceeded to Phase III which focused on UTC’s claim for contribution with respect to costs it already had incurred and its claim for a declaratory judgment allocating responsibility for costs to be incurred in the future. Efforts to reach a global settlement failed; but, they did produce the proposed partial consent decree that has been presented to the Court.

Even though the United States has not pled any claims against the settling third and/or fourth-party defendants, its participation in the consent decree is essential in order to assure the settling PRP’s that they will not be subject to future claims by the United States and/or to claims for contribution by any other PRP’s that the United States might later sue. 5

Pursuant to the proposed consent decree, UTC will be responsible- for the $14 million soil remediation project; and, UTC and the settling third and fourth-party defendants, jointly, are obligated to pay $13.5 million in cash to- the United- States. The United States also will be entitled to 50% of the net amount that UTC may recover as contribution from the non-settling third and fourth-party defendants.

Twenty-three non-settling third and fourth-party defendants object to entry of the consent decree on the ground that it does not apportion liability in a matter that is rationally related to each PRP’s fair share. 6

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United States v. Davis, 11 F. Supp. 2d 183, 47 ERC (BNA) 1090, 1998 U.S. Dist. LEXIS 10681, 1998 WL 394316 (D.R.I. 1998).

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