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of Peckar & Abramson, P.C. -- (312) 239-9722

Illinois Federal Court Denies Motion to Dismiss PRPs’ Cost-Recovery Claim

On May 12, 2010, the U.S. District Court for the Southern District of Illinois denied a motion to dismiss crossclaims for cost recovery under Section 107 of the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA” and more commonly known as Superfund) in United States v. Pharmacia Corp., No. 99-cv-63.

Section 107(a) of CERCLA (42 U.S.C. 9607(a)), subjects certain persons or companies, known as potentially-responsible parties (or “PRPs”), to liability when there is a release or threatened release of hazardous substances.  In general, PRPs are liable for (1) costs of removing or cleaning-up the hazardous substances incurred by the government, (2) other necessary costs of response incurred by any other person consistent with the national contigency plan, (3) damages to natural resources, and (4) costs of health assessments or health effects studies under certain circumstances.

Section 113(f) of CERCLA (42 U.S.C. 9613(f)) allows any person to seek contribution from any other PRP for costs paid to reimburse another party (such as the government).  In theory, this means that each PRP will only be liable to pay its fair share (i.e., each PRP’s liability will be based only on how much its conduct contributed to the release).

In United States v. Pharmacia, Pharmacia Corporation, Solutia, Inc. Cerro Flow Products, Inc., and ExxonMobil Oil Corporation were PRPs at the Sauget Area One site, which is located in the Villages of Sauget and Cahokia, in St. Clair County, Illinois.  The PRPs were sued by the federal government under Section 107 of CERCLA for the recovery of clean-up costs allegedly incurred by the government at the site.  The PRPs filed a contribution claim under Section 113 of CERCLA against Rogers Cartage to allocate responsibility for costs that may have to be paid to the government.  The federal government also sued Rogers Cartage under Sections 107 and 113, and the government ultimately lost at trial on those claims.

The PRPs also incurred their own costs while investigating and cleaning up contamination at the site, and filed a claim under Section 107 of CERCLA against Rogers Cartage to recover those costs.  Rogers Cartage then filed a motion to dismiss that claim.  The Court denied the motion to dismiss:

“Here, [the PRPs] expressly allege that the purpose of their Section 107(a) action is to recover response costs which were neither derivative of, nor co-extensive with the United States costs; in other words, expenses that are allegedly different from those sought by the United States in its trial against Rogers Cartage back in November 2003.  Now, [the PRPs] are seeking to recover some of those response costs from Rogers Cartage who, they allege, owned portions of at least three sites within Sauget Area One, and operated a truck terminal and truck washing operation on that property in the 1960’s and 1970’s.  One of CERCLA’s main purposes is to encourage private parties to assume the financial cleanup by allowing them to seek recovery from others.  Thus, allowing [the PRPs’] Section 107(a) cost recovery action to proceed neither contravenes the Supreme Court’s current interpretation of CERCLA, nor one of act’s fundamental purposes.”

Stay tuned to the Illinois Environmental Law Blog for more news and developments.

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    The Seventh Circuit Court of Appeals recently upheld the federal government’s ability to criminally prosecute environmental activists who destroy property under the federal Animal Enterprise Terrorism Act (“AETA”).

    In United States v. Johnson, the defendants travelled from Los Angeles, California to a mink farm in Morris, Illinois. The mink farm was in the business of breeding, raising, and selling minks to fur manufacturers. At the mink farm, the defendants released approximately 2000 minks from their cages. They also removed portions of the fence surrounding the mink farm to help the minks escape, and they destroyed the minks’ breeding cards, which were needed to sell the minks to a furrier. In addition, they poured caustic substances on two farm vehicles and spray-painted the words “Liberation is Love” on a barn. The vandalism caused between $120,000 and $200,000 worth of damage. The defendants then began traveling to a fox farm in Roanoke, Illinois, which bred foxes to sell to fur manufacturers. They planned to damage the fox farm as well, but they were arrested by local law enforcement before they arrived at the fox farm. The defendants were charged in state court with possession of burglary tools and were convicted. They were sentenced to 30 months imprisonment.

    Then, the defendants were charged with violating the AETA by the federal government. Count I of the indictment alleged that they conspired to travel in interstate commerce for the purpose of damaging and interfering with the operation of an animal enterprise, and in connection with that purpose, damaged the property of an animal enterprise. Count II alleged that the defendants damaged real and personal property used by an animal enterprise. The defendants moved to dismiss the indictment against them, asserting that the AETA was facially overbroad, was unconstitutionally vague, and violated substantive due process because it labeled persons who committed the act as “terrorists”. The District Court denied the motion to dismiss.

    The Seventh Circuit affirmed the District Court’s ruling that rejected all of the defendants’ arguments. In particular, the defendants suggested that the AETA prohibited advocacy that caused damage to only intangible property such as profits or goodwill. The court rejected that argument and held that the AETA prohibited destruction of or damage to tangible items and property owned by the animal enterprise. In fact, the court looked at the legislative history of the AETA, which reinforced the conclusion that it was not intended to criminalize speech or expressive conduct that caused damage only to the animal enterprise’s profits or goodwill. Several legislators made statements indicating that, while the statute was being passed to combat the violence being perpetrated against animal enterprises as well as people and entities connected to animal enterprises, Congress was aware of the importance of protecting the First Amendment right to engage in lawful protest against animal enterprises. In particular, the court looked at a speech by Senator Feinstein stating: “I fully recognize that peaceful picketing and public demonstrations against animal testing should be recognized as part of our valuable and sacred right to free expression. For this reason, all conduct protected by the First Amendment is expressly excluded from the scope of this legislation. This law effectively protects the actions of the law-abiding protester while carefully distinguishing the criminal activity of extremists.” In summary, the court found that the text of the statute as well as the legislative history made clear that the statute does not criminalize speech or expressive conduct that causes damage only to intangible profits or goodwill of an animal enterprise.

    The Seventh Circuit had an easy task in this case, deciding to interpret the statute to criminalize destructive conduct but keeping the door open to reasonable protests that do not harm private property. Environmental activists need to be aware of this line in the sand that has been drawn by Congress and the courts.
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    2 weeks ago  ·