United States v. SCA Services of Indiana, Inc.

827 F. Supp. 526, 24 Envtl. L. Rep. (Envtl. Law Inst.) 20086, 37 ERC (BNA) 1911, 1993 U.S. Dist. LEXIS 10175, 1993 WL 276473
CourtDistrict Court, N.D. Indiana
DecidedJune 28, 1993
DocketCiv. F 89-29
StatusPublished
Cited by21 cases

This text of 827 F. Supp. 526 (United States v. SCA Services of Indiana, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. SCA Services of Indiana, Inc., 827 F. Supp. 526, 24 Envtl. L. Rep. (Envtl. Law Inst.) 20086, 37 ERC (BNA) 1911, 1993 U.S. Dist. LEXIS 10175, 1993 WL 276473 (N.D. Ind. 1993).

Opinion

ORDER

WILLIAM C. LEE, District Judge.

This matter is before the court on Third-Party Plaintiff, SCA Services of Indiana, Inc. (“SCA”) and fourteen (14) of the Third-Party Defendants’ (“Settlors”) 1 “Joint Motion for Approval of Settlements” and supportive brief, filed April 20, 1993. Certain Third-Party Defendants (“Non-Settlors”) 2 filed objections to the Joint Motion for Approval of Settlements on May 7, 1993. SCA filed a reply to the opposition May 17, 1993, and counsel for four Non-settlors 3 filed a response to SCA’s reply May 27, 1993.

After a hearing on May 28, 1993, the court took the matter under advisement. For the following reasons, the Joint Motion for Approval of Settlements is GRANTED.

*529 BACKGROUND

The government initiated this environmental action by filing a complaint against SCA pursuant to §§ 104(a) and (b), 106(a), 106 and 107(a) of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §§ 9604(a) and (b), 9606(a), 9606 and 9607(a) (“CERCLA”). In that complaint, the government sought to recover past and future response costs allegedly incurred, or to be incurred, by the government at the Fort Wayne Reduction Site in Allen County, Indiana (“the site”). The government’s complaint sought to make SCA comply with all the terms of an August 26, 1988 Record of Decision (“ROD”) signed by the EPA’s Regional Administrator.

The site is located near Fort Wayne, in Allen County, Indiana. The government alleges that, from 1967 to 1976, a variety of hazardous substances (industrial wastes, industrial liquids and sludges) 4 were disposed at the site. At the May 28, 1993 hearing, at least one party estimated that remediation costs to clean up the site could exceed $15 million.

Soon after the complaint was filed, the government and SCA entered into a consent decree in which SCA agreed to perform remedial work specified in the ROD, and make specified payments to the government. The court entered the Consent Decree on July 18, 1989, and since that time, SCA has been performing work at the site under the ROD and has been making specified payments under the Decree.

In Environmental Transportation Systems, Inc v. ENSCO, Inc. 969 F.2d 503, 506 (7th Cir.1992), the Seventh Circuit discussed CERCLA’s basic scheme of contribution among Potentially Responsible Parties (“PRPs”) in environmental litigation: “Section 9613(f)[1] of Title 42, United States Code [Section 113(f)(1) of CERCLA], provides that any person may seek contribution from any other person who is liable or potentially liable under CERCLA, 42 U.S.C. §§ 9601 et seq.” 5 Given this scheme, on November 23, 1992, SCA filed its first Amended Third-Party Complaint against over eighty (80) Third-Party Defendants for contribution of costs. The Third-Party Defendants responded by filing answers and affirmative defenses to SCA’s third party complaint. 6 After much negotiation, SCA and the fourteen Settlors agreed to the terms of the pending settlements. In their memorandum accompanying the instant motion, SCA and the Settlors report that the settlement amounts for each Settlor 7

... was based upon an evaluation of the Settlor’s alleged share of liability for the generation and arrangement for transportation, treatment or disposal of wastes containing hazardous substances at the Site, and an evaluation of the costs and risks assumed by SCA under the terms of each Settlement Agreement. The determination of each Settlor’s share of liability was made based upon all information known to SCA and the individual Settlor....
Third Party Defendant’s contribution of wastes to the Site, in many cases, was calculated based upon San-A-Tainer accounts receivable documents. These documents indicate monthly customer charges for hauling and disposal at the Site ranging from $22.00 per month for small generators to $1,000.00 to $2,500.00 per month for large generators.

*530 Memorandum in Support of Joint Motion for Approval of Settlements, pp. 1 and 2.

The settlement agreements between SCA and the Settlors basically provide that the Settlors will pay SCA an established consideration, and that SCA and the Settlors covenant not to sue each other. The agreements recite that the Settlors have provided SCA with all information known to them (after the exercise of due diligence) regarding their alleged participation in contributing to the environmental degradation of the site, and the agreements also contain a standard new-information “reopener” provision. SCA and the Settlors further agree that the settlements do not become effective unless and until the Joint Motion for Approval of the Settlements is approved by the court.

DISCUSSION

In their Joint Motion for Approval of Settlements, SCA and the Settlors seek a finding that the settlements are entered into in good faith, a judgment dismissing the Settlors from SCA’s Third Party action, a judgment dismissing “all counterclaims, cross-claims and fourth party claims which have been or could be made against [the] Settlor[s] by any person in connection with the Third Party Complaint or the Consent Decree.” At the May 28, 1998 hearing, SCA and the Settlors informed the court that the protection from fourth party claims is not intended to bar any entities or persons not currently a party from bringing future fourth party claims but, rather, is intended to bar any present parties from bringing any such claims against the Settlors.

The Non-Settlors object to the settlements, and the court is faced with resolving three chief issues. First, although CERCLA does not specifically provide for protection against contribution in settlements between private parties, the court must determine whether parties such as the Settlors are relieved of liability for claims for contribution regarding matters addressed in the settlement. The second issue before the court is whether the settlements should be approved at this point. The Non-Settlors argue that settlement is “premature” due to insufficient discovery, and “prejudicial” because the parties’ “fair share” of responsibility cannot yet be determined. The third and final issue concerns determining to what extent the Non-settlors’ liability will be offset if the settlements are approved.

Private Party Settlement and Contribution

The first issue raised by the NonSettlors, whether private parties who settle CERCLA claims with other private parties are free from claims for contribution, arises from section 113(f)(2) of CERCLA, 42 U.S.C.

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827 F. Supp. 526, 24 Envtl. L. Rep. (Envtl. Law Inst.) 20086, 37 ERC (BNA) 1911, 1993 U.S. Dist. LEXIS 10175, 1993 WL 276473, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-sca-services-of-indiana-inc-innd-1993.