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ELF ATOCHEM NORTH AMERICA, INC. v. UNITED STATES

April 6, 1995

ELF ATOCHEM NORTH AMERICA, INC.
v.
UNITED STATES OF AMERICA, et al. UNITED STATES OF AMERICA VS. WITCO CORPORATION VS. ELF ATOCHEM NORTH AMERICA, INC.



The opinion of the court was delivered by: J. CURTIS JOYNER

 JOYNER, J.

 The United States has filed a Motion in civil action 94-0662 for a Ruling as to the Appropriate Standard and Scope of Review of Agency Action and to Limit the Scope of Discovery. *fn1" This Motion is directed at Witco Corporation, and that is the only party that has responded. The United States brings this Motion out of a concern that Witco may attempt to challenge the merits of the remedy the EPA chose in the Record of Decision issued in 1990 (1990 ROD). This concern arises out of certain expert reports it has recently received from Witco.

 The 1990 ROD has been incorporated into a consent decree between the United States and Elf Atochem North America. Parts of the 1990 ROD and consent decree require Elf to perform certain tests and conduct certain studies, including Treatment Studies. The EPA requires these tests and studies to ensure that the final remedy implemented will be appropriate to meet the EPA's goals of ensuring health and safety.

 One of Witco's experts, Frank Vernese, partly relied on the Treatment Studies in making his report. Portions of the Vernese Report are attached to the United States' motion. Our reading of the Vernese Report indicates that it compares the EPA's identified concerns in the 1990 ROD with the remedy EPA chose to resolve those concerns, as well as providing background technical information. *fn2" What is of primary concern to the United States is that the Vernese Report also uses recently-created information such as the Treatment Studies to bolster its conclusion that the EPA chose an inappropriate remedy.

 The United States argues that in a cost recovery action a court is limited to examining an agency's decision for abuse of discretion, *fn3" and that this review is to be based solely on the administrative record. It believes that Witco may attempt to have this Court evaluate the 1990 ROD on a de novo basis. Accordingly, the United States wants this Court to make clear that (1) we will review the 1990 ROD only for abuse of discretion, (2) this review will be based solely on the administrative record, and (3) grant, accordingly, a protective order from discovery on the remedy chosen by the EPA.

 We begin by noting that Witco does not dispute the basic premise of the United States' motion; namely, that this Court will review the remedy chosen by the EPA under the arbitrary and capricious standard. This standard has been well-established by numerous cases in every circuit. E.g., United States v. Akzo Coatings of America, Inc., 949 F.2d 1409, 1424 (6th Cir. 1991); United States v. Northeastern Pharmaceutical & Chem. Co., 810 F.2d 726, 748 (8th Cir. 1986), cert. denied, 484 U.S. 848, 108 S. Ct. 146, 98 L. Ed. 2d 102 (1987); United States v. Gurley Ref. Co., 788 F. Supp. 1473 (E.D. Ark. 1992), aff'd and rev'd, 43 F.3d 1188 (8th Cir. 1994). If there were any doubt, the language of CERCLA itself would put the doubt to rest. 42 U.S.C. § 9613(j)(2) provides that a "court shall uphold the President's decision in selecting the response action unless the objecting party can demonstrate, on the administrative record, that the decision was arbitrary and capricious or otherwise not in accordance with law." (emphasis added). Witco and the United States disagree, however, on the interpretation of the subsection immediately preceding the one just quoted. 42 U.S.C. § 9613(j)(1) provides that in:

 
any judicial action under this chapter, judicial review of any issues concerning the adequacy of any response action taken or ordered by the President shall be limited to the administrative record. Otherwise applicable principles of administrative law shall govern whether any supplemental materials may be considered by the court.

 (emphasis added). The United States encourages this Court to hold that 42 U.S.C. § 9613(j)(1) means that in this case, we may not look at anything beyond the administrative record to determine whether the EPA abused its discretion in establishing the 1990 ROD. It asserts that the language "otherwise applicable principles of administrative law" refers to four generally accepted exceptions to the administrative record rule, and that Witco cannot demonstrate that this case fits into any of the four exceptions. These exceptions allow a court to consider supplemental materials if:

 
1. judicial review is frustrated because the record fails to explain the agency's actions,
 
2. the record is incomplete,
 
3. the agency failed to consider all relevant factors, or
 
4. there is a strong showing that the agency engaged in improper behavior or ...

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