parties for contribution. The § 106 consent agreement in April, 1988, between plaintiff Gould and the EPA is a primary example of a responsible party, in this case Plaintiff Gould, resolving their liability to the government for the cleanup of a contaminated site. We find that Gould's action to recover its equitable share of its response costs is a section 113 contribution action. This finding is in accord with the various circuits that have addressed this issue. Plaintiff Gould has taken the position that the Third Circuit allows a private responsible party to bring a cost recovery action under § 107 where that party has remediated a site. However, the Third Circuit cases cited by Gould are inapplicable to the present action and do not stand for the proposition that private responsible parties can bring a § 107 cost recovery action.
Third Circuit Decisions
The issue presently before this Court has not been directly ruled upon by the Third Circuit and as such, we are not bound by precedent. The Third Circuit has implicitly accepted the position of the various circuits that a cost recovery claim by a private PRP is a claim for contribution under § 113 of CERCLA. In Smith Land & Improvement Corp. v. Celotex Corp., 851 F.2d 86 (3rd Cir. 1988), cert. denied, 488 U.S. 1029, 102 L. Ed. 2d 969, 109 S. Ct. 837 (1989), a case originally brought in this Court, the EPA informed the site owner that unless it remediated the site, EPA would perform the work and seek recovery of its costs. The owner of the site settled with EPA and incurred costs cleaning the site. The owner then brought an action against the prior owner of the site under § 107 to recover those costs.
While not directly holding the action to be a § 113 contribution action, the Third Circuit held, among other things, that in the context of a private CERCLA claim, the three defenses listed in § 107(b) are not exclusive and that a defendant may also raise equitable defenses. 851 F.2d at 89. Thus, the Third Circuit all but recognized that a cost recovery claim by a private PRP is a claim for contribution under § 113 of CERCLA because a § 107(a) cost recovery action has only the limited defenses specified in § 107(b).
The Third Circuit's interpretation of allowing equitable defenses, thus classifying a cost recovery claim by a private PRP as a § 113 contribution claim, has been adopted by Transtech Industries, Inc. v. A & Z Septic Clean, 798 F. Supp. 1079 (D. N.J. 1992), appeal dismissed, 5 F.3d 51 (3rd Cir. 1993), cert. denied, 114 S. Ct. 2692 (1994). In Transtech, a case that closely resembles the factual underpinnings before us, the EPA filed an action against the owners and operators of the Site, which was designed to force those responsible for the Site's situation to engage in cleanup operations. Plaintiff's in Transtech argued that the statutory scheme, § 107 and § 113, divides causes of action between privately initiated cleanups and cleanups initiated under threat by the EPA. Under plaintiffs' theory, claims of the former type constituted claims for response costs under § 107, while claims of the latter type were contribution claims under § 113(f)(1). The plaintiffs then contended that since they voluntarily began their cleanup operation, theirs was a cost recovery action under § 107. 798 F. Supp. at 1085.
The Transtech opinion further held that Congress enacted section 113(f)(1), to provide for fairness in situations where one party was bearing the cost of a major hazardous waste site simply because the EPA targeted it first. Id. at 1086. The court in Transtech also rejected plaintiffs' argument that the action was a § 107 cost recovery action because plaintiffs acted voluntarily in cleaning up the site. The court noted that plaintiffs actions were clearly the result of government threats. Likewise, in the present action, Plaintiff Gould acted in response to EPA directives, highlighted by Gould's and the EPA's signing of the April, 1988, Consent Order. Thus, it appears evident that when a party, who agrees to cleanup a site pursuant to a settlement agreement, sues another liable party, it is a claim for contribution and it must be distinguished from cases in which a plaintiff incurred expenses on its own initiative.
In Witco Corp. v. Beekhuis, 38 F.3d 682 (3rd Cir. 1994), the Third Circuit again implicitly held that a cost recovery claim by a private responsible party is a claim for contribution. The Third Circuit began its opinion by noting that the case before it was an action for contribution. 38 F.3d at 684. Like the present matter, Witco was a suit brought by a site owner, who had signed a consent agreement with EPA, against other PRPs. The court several times cited the contribution action statute of limitations in § 113(g)(3), always indicating that the action was properly one in contribution under § 113.
Plaintiff Gould's reliance on Hatco Corp. v. W.R. Grace & Co., 59 F.3d 400, 1995 WL 396749 (3rd Cir. 1995), is misplaced. Gould asserts that Hatco stands for the proposition that a § 107 cause of action is available to a private responsible party when they remediate a site. However, Hatco centered around § 9607(e) which deals with indemnification, hold harmless, etc., agreements, conveyances; or subrogation rights. Hatco simply does not hold that a § 107 cost recovery action is available to a private responsible party.
Even if we were to determine that Hatco addressed the § 107 issue, which it does not, we are of the opinion that the position adopted in Transtech (holding that when a party who agreed to cleanup pursuant to a settlement agreement sues a liable party, it is a claim for contribution and it must be distinguished from cases in which a plaintiff incurred expenses on its own initiative) is the proper approach when dealing with private responsible parties.
Plaintiff Gould also places reliance on the United States Supreme Court's decision in Key Tronic Corp. v. United States, 128 L. Ed. 2d 797, 114 S. Ct. 1960 (1994), for its position that a § 107 cost recovery action could be brought by a responsible party. Plaintiff Gould argues because the Supreme Court never suggested only innocent parties could bring a § 107 action, that the Key Tronic opinion grants an implied cause of action for a responsible party to bring a § 107 action. Nonetheless, it appears clear to this Court that Key Tronic focused on whether or not attorney's fees are a necessary cost of response within a § 107 action.
In addressing the issue of recovering attorney's fees as response cost, Justice Stevens stated, "although § 107 unquestionably provides a cause of action for private parties to seek recovery of cleanup costs, that cause of action is not explicitly set out in the text of the statute. To conclude that a provision that only impliedly authorizes suit nonetheless provides for attorney's fees with the clarity required by Alyeska would be unusual if not unprecedented." Key Tronic at 1967.
Key Tronic's opinion focused on what types of fees may or may not be recoverable as part of § 107 response costs. Because the Supreme Court suggested that an implied cause of action under § 107 exists for private parties, (the Court never addressed the issue of whether or not only innocent parties could bring a § 107 action), Gould argues that Key Tronic allows them to bring a § 107 cost recovery action. However, Key Tronic did not answer the question of whether a responsible party could bring a § 107 action. As numerous courts of appeals, including the Third Circuit, have addressed this very issue, we are unpersuaded by Gould's position that they can assert a § 107 cost recovery action. The overwhelming belief is that when both parties are PRPs the action will sound in contribution.
Plaintiff Gould also places reliance on the recent decision in Bethlehem Iron Works, Inc. v. Lewis Industries, Inc., 1995 U.S. Dist. LEXIS 8476, Civ. A. 94-0752, 1995 WL 376475 (E.D. Pa. June 20, 1995). In that case, the plaintiff was a responsible party that had incurred response costs in remediating a hazardous site under CERCLA. The plaintiff was allowed to bring a § 107 cost recovery action. That opinion reasoned that "permitting plaintiffs to raise their § 107 claims comports with CERCLA's goal of encouraging parties to initiate cleanup operations promptly and voluntarily." Bethlehem at 4.
This Court is of the opinion that the Bethlehem court allowed a § 107 action by focusing on CERCLA's goals of having responsible parties initiate cleanup actions voluntarily and promptly. Once again, in the instant action, Plaintiff Gould did not voluntarily initiate cleanup of the Marjol Site. Gould's cleanup operations were the direct result of the EPA Consent Order of April, 1988. Thus, we reiterate our support for the holding in Transtech Industries v. A & Z Septic Clean, 798 F. Supp. 1079 (D. N.J. 1992), appeal dismissed, 5 3d. 51 (3rd Cir. 1993), cert. denied, 114 S. Ct. 2692 (1994), that when a party agrees to cleanup a site pursuant to a settlement agreement, and sues another liable party, it is a claim for contribution and must be distinguished from cases in which a plaintiff incurred expenses upon its own initiative.
While the Third Circuit has only implicitly found that a cost recovery claim by a private party is a § 113 contribution action, other circuits have explicitly found that in private party CERCLA actions, one responsible party's claim against another responsible party is a contribution claim subject to the provisions of § 113.
In United States v. Colorado & Eastern R.R., 50 F.3d 1530 (10th Cir. 1995), a PRP brought a cross-claim against another PRP under § 107 and the targeted PRP argued that the claim should be treated as a "contribution" claim. The court found that the claimant was a PRP and "therefore, any claim that would reapportion costs between [the] parties is the quintessential claim for contribution." Id. at 1536, citing Restatement (Second) of Torts at 888A (1979), and Amoco Oil v. Borden, Inc., 889 F.2d 664, 672 (5th Cir. 1989). The Tenth Circuit further reasoned that to allow one PRP to recover costs from another PRP under the strict liability scheme of § 107 would eviscerate § 113. Id. at 1536.
In United Technologies Corp. v. Browning-Ferris Industries, Inc., 33 F.3d 96 (1st Cir. 1994), cert. denied, 130 L. Ed. 2d 1128, 115 S. Ct. 1176 (1995), the First Circuit found that the plaintiff's action was one for "contribution" and not for cost recovery under § 107. The court determined that the plaintiff was also a liable party and concluded that its claim "must be classified as an action for contribution." Id. at 101.
Additionally, the Seventh Circuit in Akzo Coatings v. Aigner Corp., 30 F.3d 761 (7th Cir. 1994), found that a liable party seeking recovery of costs it had incurred in cleanups, has only a claim for "contribution" despite the fact that § 107 permits "any person" to seek recovery. The court determined that Akzo had no cause of action under § 107 because:
Akzo has experienced no injury of the kind that would typically give rise to a direct claim under Section 107 (a) -- it is not, for example, a landowner forced to clean up hazardous materials that a third party spilled onto its property or that migrated there from adjacent lands. Instead, Akzo itself is a party liable ... and the gist of Akzo's claim is that the costs it has incurred should be apportioned equitably amongst itself and the others responsible.... That is a quintessential claim for contribution.
Id. at 764.
In Amoco Oil Co. v. Borden, Inc., 889 F.2d 664 (5th Cir. 1989), the Fifth Circuit held that any action among PRPs is for contribution. In Amoco, a PRP sued to recover response costs it had incurred and would incur under a cleanup. The court held it first must determine if the defendant is a liable person under § 107(a). The "court then must ascertain, under CERCLA's contribution provision, each responsible party's equitable share of the cleanup costs." Id. at 668. "When one liable party sues another to recover its equitable share of the response costs, the action is one for contribution..." Id. at 672.
We find no credence in Gould's argument that the Amoco case is an example of courts using a two-step process to determine each party's response costs. The fact that the Amoco court went to § 107 (a) first was merely to determine if a party was liable, for it is § 107 (a) that determines whether or not a party is liable. Gould favors an approach whereby a PRP can bring a § 107 action to recover its response cost and then have the other liable parties bring a § 113 contribution counterclaim to allocate liability. Amoco looked to § 107(a) only to determine if a party may be liable. It was not a situation where the two-step process was initiated. Because both parties, like here, were PRPs, the claim to reapportion costs between the parties was found to be a contribution claim.
Most recently, Control Data Corp. v. S.C.S.C. Corp., 53 F.3d 930, 1995 U.S. App. LEXIS 10285 (8th Cir. May 10, 1995), joined the growing list of appeals courts that ruled that private party CERCLA litigation brought by a liable party to recover costs is an action governed by the contribution provisions of § 113.
Based on the numerous circuit holdings as well as the implicit findings in the Third Circuit, when a private responsible party sues another responsible party to apportion costs, that action will be a "contribution" action pursuant to § 113. The cases relied upon by Plaintiff Gould are either misplaced or distinguishable. In a factual situation, like the present action, where a responsible party initiates a site cleanup pursuant to governmental pressure, and then sues another responsible party to allocate the costs, the action falls under the provisions of § 113. We agree that a private cause of action may exist under § 107, as is implied by Key Tronic Corp. v. United States, 128 L. Ed. 2d 797, 114 S. Ct. 1960 (1994). However, the issue of whether the action is available for a non-innocent party was never addressed by the Supreme Court. As such, we have proceeded along the same avenue taken by the United States Court of Appeals for the 1st, 5th, 7th, 8th and 10th Circuits, as well as the implicit findings of the Third Circuit in Smith Land & Improvement Co. v. Celotex Corp., 851 F.2d 86 (3rd Cir. 1988), cert. denied, 488 U.S. 1029, 102 L. Ed. 2d 969, 109 S. Ct. 837 (1989); and Witco Corp. v. Beekhuis, 38 F.3d 682 (3rd Cir. 1994). Plaintiff Gould may not bring a § 107 cost recovery action and is instead limited to bringing a § 113 contribution action. Partial Summary Judgment is therefore granted to the moving Defendants on the nature of the claim issue.
"ORPHAN SHARES "
After finding in favor of the moving Defendants on their motion for partial summary judgment with respect to Plaintiff Gould being limited to asserting a § 113 cause of action, we turn our attention to the issue concerning the so-called "orphan shares" that were deposited at the Marjol-Site. Since liability under a § 113 action is several, not joint and several, each party is only responsible for their proportionate share of the harm caused at the Marjol-Site.
The Defendants are not responsible to Gould for the "orphan shares" in question. The contribution provision of § 113 states in part, "In resolving contribution claims, the court may allocate response costs among the liable parties under such equitable factors as the court determines are appropriate." 42 U.S.C. § 9613(f)(1). In allocating response costs, this Court can think of no greater equitable factor than Plaintiff Gould's own waste-in-list. This list establishes the exact amount of harm caused by every Defendant, after the deduction of Plaintiff's share and the "orphans shares". As liability in a § 113 contribution action is several, the Defendants are responsible for their respective contributions to the harm at the Marjol-Site. It appears to this Court that it would be most inequitable to hold Defendants liable for any of the "orphan shares" when Gould's waste-in-list specifically indicates the exact amount each Defendant contributed to the harm.
Therefore, Defendants motion for partial summary judgment is granted with respect to each Defendant being responsible for its own contribution to the harm. Plaintiff Gould cannot collect any part of the "orphan shares" from the Defendants.
STATUTE OF LIMITATIONS
Turning to the issue concerning the applicable statute of limitations for a contribution action, the parties are clearly in disagreement as to which statute applies. The parties cite two different sections of CERCLA as being the applicable statute of limitations section.
The court in United Technologies Corp. v. Browning-Ferris Industries, 33 F.3d 96, 99 (1st Cir. 1994), cert. denied, 130 L. Ed. 2d 1128, 115 S. Ct. 1176 (1995), stated that the statutory language of § 113(g)(2) and § 113(g)(3) suggests that cost recovery and contribution actions are distinct and do not overlap. This reasoning becomes vital when examining the respective positions of the parties. We believe both sides are somewhat incorrect in their briefs on this issue. Plaintiff Gould is in error in asserting that § 113(g)(2) is the appropriate statute of limitations section and likewise, Defendants are incorrect in asserting that under § 113(g)(3) Plaintiff is time barred by the three year statute of limitations from bringing this action.
Plaintiff Gould is of the opinion that they can bring a cost recovery action under § 107 of CERCLA. 42 U.S.C. § 9607. This section is controlled by the statute of limitations in § 113(g)(2) which reads as follows:
(2) Actions for recovery of costs
An initial action for recovery of the costs referred to in section 107 of this title must be commenced--
(A) for a removal action, within 3 years after completion of the removal action, except that such recovery action must be brought within 6 years after a determination to grant a waiver under section 9604(c) (1) (C) of this title for continued response action; and
(B) for a remedial action, within 6 years after initiation of physical on-site construction of the remedial action, except that, if the remedial action is initiated within 3 years after the completion of the removal action, costs incurred in the removal action may be recovered in the cost recovery action brought under this subparagraph.