United States v. Sterling Centrecorp Inc.

208 F. Supp. 3d 1126, 83 ERC (BNA) 1352, 2016 U.S. Dist. LEXIS 129993, 2016 WL 5341517
District Court, E.D. California·Decided September 22, 2016·No. No. 2:08-cv-02556-MCE-JFM·Published·Cited by 1 cases

Opinion

MEMORANDUM AND ORDER

MORRISON C. ENGLAND, JR., UNITED STATES DISTRICT JUDGE

Both the United States and the California Department of Toxic Substances (hereinafter collectively referred to as “Plaintiffs” or “government” unless otherwise specified) have designated the former Lava Cap Mine, located in Nevada County, California, as a Superfund site polluted by elevated levels of arsenic that were disseminated through tailings and waste materials generated by mine operations. Plaintiffs have undertaken cleanup efforts designed to remediate that arsenic contamination. The present action, filed pursuant- to' the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601, et seq. (“CERCLA”), seeks contribution for the costs of those activities both from former owners of the site and operators responsible for its mining. After bifurcating the case between liability and damages, a bench trial as to the liability of Defendant Sterling Centrecorp Inc. (“Sterling”) was held over four days between October 31, 2012, and November 7, 2012. Those proceedings resulted in Findings of Fact and Conclusions of Law filed June 20, 2013, and June 24, 2013, that found Sterling liable for all proper removal and remedial costs incurred by Plaintiffs at the Mine. ECF Nos. 211, 213.1

Presently before the Court are two related motions for summary judgment pertaining to the second damages phase of this case. Both Plaintiffs and Defendant Sterling Centrecorp Inc. (“Sterling”) ask the Court to summarily adjudicate the extent and recoverability of Plaintiffs response costs under Section 107 of CERC-LA. As set forth below, Plaintiffs’ Motion is GRANTED and Defendant Sterling’s Motion is DENIED.2

[1130]*1130BACKGROUND

The Lava Cap Mine Superfund Site is located on approximately thirty acres in a rural residential area in the foothills of the Sierra Nevada Mountains. Gold and silver mining activities at the site began in approximately 1860. Between 1943 and 1945 mining was conducted at the site by the Lava Cap Gold Mining Corporation (“LCGMC”). Mining operations resulted in two piles of mining waste, a waste rock pile and a mill tailings pile. Findings of Fact ¶¶ 34-35.3 The waste rock pile, estimated to be several stories high, was situated immediately next to the mine and mill budding. Id. at ¶ 34. The fine-grained materials comprising the mill tailings were impounded downstream from the mill behind a timber dam on Little Clipper Creek. Id. at ¶¶ 12, 35. In 1938, LCGMC created another dam on Greenhorn Creek to also trap mill tailings, thereby creating Lost Lake. Id at ¶13.

In 1979, a partial log dam collapse led to a release of mine tailings into Little Clipper Creek which, in turn, caused downstream neighbors to complain about pollution from the resulting silt. Findings of Fact ¶¶ 142-43, 166. In October of that year, the Central Valley Regional Control Board and the California Department of Fish and Game investigated and found that arsenic contaminated tailings had entered Little Clipper Creek and flowed downstream to Lost Lake. Id. at ¶ 142-43, 21. The Regional Water Quality Control Board thereafter issued a Cleanup and Abatement Order to Keystone, which technically held title to the Mine at the time. Id. at ¶ 144.

Following an ultimately unsuccessful attempt to sell the Lava Cap Mine to another company, Keystone sold the property in 1989 to Banner Mountain Properties, Ltd., an entity controlled by Defendant Stephen Elder, who currently owns four of the seven parcels comprising the former mine site. The remaining three parcels are owned by another Elder business interest, Defendant Elder Development, Inc.

The United States Environmental Protection Agency (“EPA”) completed a Preliminary Assessment on the mine site in April of 1993, after Elder’s purchase of the 'property. Sediment and soil samples revealed elevated concentrations of both arsenic and lead.

Heavy rainstorms in 1997 washed mine wastes downstream into Little Clipper Creek- and Lost Lake. The upper half of the log dam thereafter collapsed, discharging an estimated 10,000 cubic yards of additional tailings contaminated with arsenic. Findings of Fact ¶ 21. In October of 1997, the EPA determined that the tailings release from the Mine met the National Contingency Plan (“NCP”) criteria for a removal action under 40 C.F.R. § 300.415(b)(2). During 1997 and 1998, the EPA conducted a physical removal action at the Site. Pis.’ Compl., ¶¶ 35-39. Thereafter, in January of 1999, the Site was officially designated a Superfund site in light of its potential risk to human health and the environment. Soil, sediment, surface water and groundwater contamination from mining operations continues at the Site.

The EPA has conducted a variety of response activities to address this contamh nation. Plaintiffs’ Statement of Undisputed Facts (“PUF”) No. 12. It has reviewed information and sampling data for prior assessments, performed and analyzed groundwater, surface water, sediment and soil sampling to determine the extent of contamination, analyzed alternatives for [1131]*1131eliminating or reducing said contamination, and performed several response actions to prevent exposure to hazardous contaminants. Id. at 13-24.

Because of the size of the Site, the EPA elected to divide it into four operable units. Sterling’s Statement of Undisputed Facts (“DUF”) at No. 7. Only two of those operative units are at issue in the current motions. Operative Unit 1 (“OU1”) consisted of: 1) the residences on the mine property; 2) building, soils, and surface water contamination on the mine property; and 3) contaminated soils along Little Clipper Creek downstream to Greenhorn Road. Id. at 8. The EPA selected remedial treatment for OU1 consisting of removing “hot spots” of soil contamination near the mine buildings, removing mine equipment, constructing surface water diversions around the tailings and waste rocks piles, and installing a system to collect and treat water flowing from the mine entrance and seeping from the buttress containing the failings. Id. at 11. In addition, the treatment employed also included covering the waste rock pile with soil and vegetation, and covering the tailings pile with a High Density Polyethylene (“HDPE”) synthetic liner and vegetated soil. Id. at 12.

Operative Unit 2 (“OU2”) addressed risks posed by contaminated groundwater, including groundwater then used for drinking water by five residences. The remedy chosen by EPA was interim in nature because studies for possible long-term groundwater treatment were still ongoing, and potentially years away. See id. at 18. As an interim measure, EPA built a $3,795 million pipeline to connect the impacted residences to a municipal water supply provided by the Nevada Irrigation District. Id. at 24.

According to the government, through November 30, 2012, it incurred $32,205,011.39 in response costs at the Site. PUF at No. 42. Additionally, the California Department of Toxic Substances Control (“DTSC”) has $781,878.01 in un-reimbursed response costs through October 31, 2014, and expects that figure to increase. Id. at 56. Of those amounts, the government claims it spent $3,611,624 on enforcement and legal costs that will be presented to the Court at a later date, and the DTSC spent some $58,151.25 for similar costs. Id.

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United States v. Sterling Centrecorp Inc., 208 F. Supp. 3d 1126, 83 ERC (BNA) 1352, 2016 U.S. Dist. LEXIS 129993, 2016 WL 5341517 (E.D. Cal. 2016).

208 F. Supp. 3d 1126 (United States v. Sterling Centrecorp Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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