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Transtech Industries Inc. v. Clean


filed: September 17, 1993.


Before: Scirica, Nygaard, and Weis, Circuit Judges.

Author: Weis


Weis, Circuit Judge.

In this case brought under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), the district court rejected appellants' contention that, having entered into a settlement with the Environmental Protection Agency, they were relieved of responsibility for cleanup expenses incurred by the owners of a landfill. We conclude that the district court's denial of summary judgment and refusal to enforce a settlement is a collateral order not appealable under the Cohen exception. Accordingly, we will dismiss the appeal.

The owners and operators of the Kin-Buc Landfill in New Jersey brought this suit in 1990 seeking contribution for costs incurred in cleaning up that hazardous waste site. The 445 named defendants are generators, transporters, or haulers of hazardous waste who are alleged to be potentially responsible parties liable to plaintiffs for past expenses incurred at the site, as well as for anticipated future costs.

Approximately 200 of the defendants ("settlor-defendants") moved for summary judgment asserting that, as a result of a settlement agreement with the Environmental Protection Agency embodied in a 1988 consent decree, they were not liable to plaintiffs. The district court denied the motion concluding that the consent decree covered only costs incurred by the United States and did not purport to absolve the settlor-defendants from liability for contribution to plaintiffs for their separate expenditures.

Under CERCLA, parties who have "resolved [their] liability to the United States . . . in a[] . . . judicially approved settlement shall not be liable for claims for contribution regarding matters addressed in the settlement."

42 U.S.C. § 9613(f)(2). The court concluded, however, that the application of that statutory provision was limited by the terms of the settlement agreement and that "in no way was the government absolving defendants from all liability to any other party for the ongoing problems at the site." The court then denied settlor-defendants' request for certification of a controlling question of law under 28 U.S.C. § 1292(b). Approximately 35 of the settlor-defendants have appealed.

Settlor-defendants contend that this Court has jurisdiction under the "collateral order" doctrine articulated in Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 545-47, 93 L. Ed. 1528, 69 S. Ct. 1221 (1949). In that case, the Court defined an exception to the final judgment requirement of 28 U.S.C. § 1291 as a "small class [of decisions] which finally determine claims of right separable from, and collateral to, rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated." Id. at 546.

In Coopers & Lybrand v. Livesay, 437 U.S. 463, 57 L. Ed. 2d 351, 98 S. Ct. 2454 (1978), the Court listed three criteria that must be present for an interlocutory order to come within Cohen 's narrow exception to the final-judgment rule. The order must (1) conclusively determine the disputed question; (2) resolve an important issue completely separable from the merits of the action; and (3) be effectively unreviewable on appeal from a final judgment. Id. at 468.

The Supreme Court has been chary of expanding the Cohen exception any further. In Lauro Lines s.r.l. v. Chasser, 490 U.S. 495, 498, 104 L. Ed. 2d 548, 109 S. Ct. 1976 (1989), the Court found that an interlocutory order denying enforcement of a contractual forum-selection clause did not satisfy the third requirement of the collateral order doctrine. The Court reiterated its "general rule" that an order is "effectively unreviewable" only if it "involves an asserted right the legal and practical value of which would be destroyed if it were not vindicated before trial." 490 U.S. at 498-99 (internal quotations omitted). That an erroneous ruling may result in additional litigation expense "'is not sufficient to set aside the finality requirement imposed by Congress' [in section 1291]." Id. at 499 (quoting Richardson-Merrell Inc. v. Koller, 472 U.S. 424, 436, 86 L. Ed. 2d 340, 105 S. Ct. 2757 (1985)).

An immunity to civil suit itself is a right that can be lost if not enforced before trial. Consequently, an order rejecting official immunity is immediately appealable, Mitchell v. Forsyth, 472 U.S. 511, 525, 86 L. Ed. 2d 411, 105 S. Ct. 2806 (1985), as is one denying effect to the protection of the "Speech or Debate Clause," Helstoski v. Meanor, 442 U.S. 500, 506-08, 61 L. Ed. 2d 30, 99 S. Ct. 2445 (1979). See also Abney v. United States, 431 U.S. 651, 662, 52 L. Ed. 2d 651, 97 S. Ct. 2034 (1977) (order denying right not to stand trial on double jeopardy grounds is appealable before final judgment).

Although an order denying immunity to suit falls within the narrow confines of the "collateral order" doctrine, that exception may not be allowed to swallow the rule. In Van Cauwenberghe v. Biard, 486 U.S. 517, 100 L. Ed. 2d 517, 108 S. Ct. 1945 (1988), the Court remarked that "in some sense, all litigants who have a meritorious pretrial claim for dismissal can reasonably claim a right not to stand trial." Id. at 524. The Court further reasoned:

"Because of the important interests furthered by the final-judgment rule . . . and the ease with which certain pretrial claims for dismissal may be alleged to entail the right not to stand trial, we should examine the nature of the right asserted with special care to determine whether an essential aspect of the claim is the right to be free of the burdens of a trial."

Id. at 524-25.

In Van Cauwenberghe, the Court assumed the validity of defendant's contention that he was immune from service of process, but held, nonetheless, that the district court's denial of his motion to dismiss was not immediately appealable. Id. at 524. "Because the right not to be subject to a binding judgment may be effectively vindicated following final judgment, we have held that the denial of a claim of lack of jurisdiction is not an immediately appealable collateral order." Id. at 527.

We have followed the Supreme Court's admonition and "have consistently construed the Cohen exception narrowly rather than expansively." Lusardi v. Xerox Corp., 747 F.2d 174, 176-77 (3d Cir. 1984); see also Praxis Properties, Inc. v. Colonial Sav. Bank, s.l.a., 947 F.2d 49, 54 (3d Cir. 1991); Demenus v. Tinton 35 Inc., 873 F.2d 50, 53 (3d Cir. 1989). We considered the problem in Borden Co. v. Sylk, 410 F.2d 843 (3d Cir. 1969), observing:

"We have detected what appears to be an irresistible impulse on the part of appellants to invoke the 'collateral order' doctrine whenever the question of appealability arises. Were we to accept even a small percentage of these sometime exotic invocations, this court would undoubtedly find itself reviewing more 'collateral' than 'final' orders."

Id. at 845-46. For a comprehensive review of the collateral order doctrine, see 15A Charles A. Wright et al., Federal Practice and Procedure §§ 3911 to 3911.5 (1992).

Turning then to the issues presented in the case before us, we first consider the factors set out in Coopers & Lybrand, 437 U.S. at 468. We may assume that the district court's order is final because there is no indication that it was tentative or less than the last word on the settlor-defendants' construction of the consent decree. We have substantial doubts, however, that the issues settlor-defendants raised in defense of appellate jurisdiction under the collateral order doctrine are distinct from the underlying merits of the lawsuit. We need not linger long on this point, however, because it is quite clear that the settlor-defendants' contentions can be raised on direct appeal after final judgment. Therefore, the interlocutory order fails to meet all of the requirements needed to fall within Cohen 's narrow exception to the final-judgment rule.

Recognizing that deficiency, settlor-defendants assert that the consent decree grants them immunity from suit, relying on a line of cases holding that interlocutory orders denying enforcement of settlement or release agreements are immediately appealable. See Forbus v. Sears, Roebuck & Co., 958 F.2d 1036, 1039-40 (11th Cir. 1992); Grillet v. Sears, Roebuck & Co., 927 F.2d 217, 219-20 (5th Cir. 1991); Janneh v. GAF Corp., 887 F.2d 432, 436 (2d Cir. 1989); Towers Hotel Corp. v. Rimmel, 871 F.2d 766, 769-70 (8th Cir. 1989); cf. Chaput v. Unisys Corp., 964 F.2d 1299, 1301 (2d Cir. 1992). Those cases are factually distinguishable from the case before us in that they involved disputes over settlement agreements between plaintiffs and defendants. Here, however, the settlement agreement was between settlor-defendants and the EPA -- an entity that is not a party to this case. Plaintiffs are not alleged to have reached any agreement with the settlor-defendants on the claim incorporated in the complaint.

More significant, however, is our disagreement with the decisions in Forbus, Grillet, Janneh and Towers. We believe that they undermine the final-judgment rule and expand the immunity concept beyond that which the Supreme Court has approved. In our view, Desktop Direct, Inc. v. Digital Equip. Corp., 993 F.2d 755 (10th Cir. 1993), more closely conforms to the Supreme Court's teaching.

In Midland Asphalt Corp. v. United States, 489 U.S. 794, 103 L. Ed. 2d 879, 109 S. Ct. 1494 (1989), the Supreme Court cautioned that one should not "play word games with the concept of a 'right not to be tried.'" Id. at 801. The Court went on to explain that "[a] right not to be tried in the sense relevant to the Cohen exception rests upon an explicit statutory or constitutional guarantee that trial will not occur . . . ." Id.

Cases involving claims of official immunity have listed interests that justify permitting freedom from suit, such as "'the general costs of subjecting officials to the risks of trial -- distraction of officials from their governmental duties, inhibition of discretionary action, and deterrence of able people from public service.'" Mitchell, 472 U.S. at 526 (quoting Harlow v. Fitzgerald, 457 U.S. 800, 816, 73 L. Ed. 2d 396, 102 S. Ct. 2727 (1982)). No such public policy considerations are present in the case at hand.

In Desktop Direct, the United States Court of Appeals for the Tenth Circuit declined to review an order vacating a settlement between plaintiff and defendant. The Court concluded that the Cohen doctrine should "not be expanded without compelling justification. A claimed right to avoid litigation based on a private contract to that effect does not meet this standard." 993 F.2d at 760. The Court also observed that it did not "see how a private settlement contract is significantly different from the contracted forum selection clause the Supreme Court refused to enforce through interlocutory appeal in Lauro Lines." Id.

Settlor-defendants seek some support from CERCLA, but we are not convinced. Indeed, we note that the language of section 9613(f)(2) supplies another basis for our Conclusion that settlor-defendants have no immunity from suit. That section provides that parties settling with the United States "shall not be liable for claims for contribution regarding matters addressed in the settlement." 42 U.S.C. § 9613(f)(2). We believe it is significant that the statute does not include the word "immunity," but merely refers to a party's "liability."

In Brown v. Grabowski, 922 F.2d 1097, 1109 (3d Cir. 1990), we refused to review an interlocutory order rejecting claims of official immunity based on state law. Although state law conferred immunity from liability, we found no authority that granted immunity from suit as well. Id. at 1108.

As the Court pointed out in Van Cauwenberghe, undoubtedly there is value to the litigant "'in triumphing before trial, rather than after it.'" 486 U.S. at 524 (quoting United States v. MacDonald, 435 U.S. 850, 860, & n.7, 56 L. Ed. 2d 18, 98 S. Ct. 1547 (1978)). Ordinarily, however, the benefits of the final-judgment rule, including discouragement of piecemeal appeals, efficient utilization of judicial resources, and prevention of delay and ultimate Disposition, take precedence. Id. at 521 n.3, 524-25. If settlor-defendants had a right to an appeal, it would be difficult to deny one to other litigants who can assert the benefit of such affirmative and dispositive defenses as claim or issue preclusion, statute of limitations, lack of subject matter jurisdiction, and the like. In Powers v. Southland Corp., 4 F.3d 223 (3d Cir. 1993), we held that an order joining a party despite the lapse of the statute of limitations was not appealable as a collateral order. We observed: "While it could be argued that a statute of limitations entails a right not to be sued after the expiration of the limitations period, that contention was rejected by this court in connection with a criminal statute of limitations." Powers, No. 92-1562, slip op. at 18 (citing United States v. Levine, 658 F.2d 113, 124-29 (3d Cir. 1981)). Levine presented an even stronger case for construing the lapse of the statute of limitations as an immunity from prosecution and trial, but, nevertheless, this Court held that the Cohen exception did not apply. Levine, 658 F.2d at 129.

We are persuaded that orders denying summary judgments on claims of immunity from trial based on releases or settlements are not appealable as Cohen collateral orders. Consequently, we lack jurisdiction and will dismiss this appeal.

Settlor-defendants have requested us to consider their appeal, in the alternative, as a petition for mandamus. We do so, but deny the petition for failure to assert a cognizable basis for relief.

The appeal will be dismissed without prejudice. The petition for mandamus will be denied.


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