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Owner/Operator Liability Under CERCLA Without Actually Owning or Operating the Site

A federal court has determined that CERCLA “owner” and “operator” liability may extend to parties even if an independent third party moves or transports the hazardous substances from the CERCLA “facility” to a new and different location. Consequently, according to the U.S. District Court for the District of New Jersey in EPEC Polymers Inc. v. NL Industries Inc. (No. 12-3842, May 28, 2013) (unreported), it is not necessary for a party to own the property on which the hazardous substances are ultimately deposited in order to be liable as an owner/operator under Superfund.

Defendant NL Industries Inc. argued in its motion to dismiss plaintiff’s CERCLA section 107 cost recovery claims, that it could not be held liable as an owner/operator of a facility based on allegations it disposed of hazardous radiological materials into the Raritan River which materials, years later, were dredged by the U.S. Army Corps of Engineers and placed across the river on land owned by plaintiff. In particular, the defendant argued that it neither owned the property where the substances were placed by the Army Corps of Engineers and came to be located, nor where the plaintiff allegedly incurred CERCLA response costs.

The court was not convinced. Instead, for purposes of determining owner/operator liability, the federal court held that the operative “facility” is that location which is the source of the hazardous substances at the time of release. And since the defendant would be strictly liable for damages resulting from its discharge of hazardous materials into the Raritan River, it was irrelevant to owner/operator liability that the Army Corps of Engineers subsequently moved those materials from the riverbed onto the plaintiff’s property.

Plaintiff’s second CERCLA claim, premised on arranger liability pursuant to 42 U.S.C. § 9607(a)(3), was also found to be viable because an arranger can be “any person who by contract, agreement, or otherwise arranged for disposal or treatment of a hazardous substance.” The court held that under a broad reading of the statute, as well as existing legal precedent, a plaintiff must simply prove that the hazardous substances were deposited at a site from which there was a release — no transaction with a third-party is necessary. Allegations that the defendant deposited hazardous materials into the river were deemed sufficient to state a prima facie claim for arranger liability under CERCLA.