The opinion of the court was delivered by: CONABOY
FINDINGS OF FACT AND CONCLUSIONS OF LAW
By Order dated January 28, 1997, (Doc. 1579), this Court bifurcated the trial of this case into four (4) phases.
On Monday, February 24, 1997, the Court conducted the first day of the non-jury trial. Thereafter, the Court held sixteen (16) court days of testimony concerning the allocation of response costs among the plaintiffs and defendants. In accordance with Fed. R. Civ. P. 52(a), the following constitutes this Court's findings of fact and conclusions of law.
The present findings of fact and conclusions of law deal specifically with Phase II of the trial, the allocation phase. The Court has heard lengthy testimony and many witnesses and has received extensive evidence on what the parties wish the Court to consider in determining the manner and mathematical method by which our decision is to be made on how the responsibility for the damages should be allocated between the plaintiff and the defendants.
This action was commenced on December 23, 1991. The plaintiff, Gould, Inc., initiated this action pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, (hereinafter "CERCLA"), 42 U.S.C. § 9601 et seq. A total of 235 defendant suppliers were originally named in this action. Thirty-seven (37) active defendant battery suppliers remain.
A. Early Beginnings of the Site
The Marjol Battery & Equipment Company (hereinafter "Marjol") operated a battery breaking facility (hereinafter "the site") from 1961 until 1980 in the Borough of Throop, Lackawanna County, Pennsylvania Gould, Inc. (hereinafter "Gould") acquired the site from Marjol on May 7, 1980. Larry Fiegleman was the president and sole shareholder of Marjol until the time the operation was acquired by Gould.
Gould, Incorporated, a corporation which is incorporated under the Delaware corporate law and has its principle place of business in Eastlake, Ohio, is a corporation in the business of electronics. Gould also has a metals division.
The site is located uphill from a surrounding residential area. The land surface slopes from east to west, and is comprised of 43.9 acres of land which includes a 7.7 acre primary battery casing material fill area, strip pits, an operational area and approximately 20 acres of wooded terrain. The operation itself contained temporary stockpile areas, a battery house, several storage bins, an acid treatment plant, a melting pot, a storage building, a storage shed, a maintenance garage, an office and a scale.
B. History Of The Process Of Lead Extraction And Marjol's Operations
In the 1960's, the battery breaking business was a common industry. Batteries, essentially from automobiles, were in common supply in the United States. The batteries consisted of an exterior shell or casing that contained a series of positive and negative lead plates which were activated by the addition of a mixture of sulphuric acid and water. In an effort to salvage certain materials, it became necessary to break the batteries, and any salvageable portion especially the lead, would be extracted.
In the beginning, batteries were broken with an ax. Subsequently, the batteries would be heated so that the rubber or tar-like cover of the battery cells would melt and the cells could then directly be pulled out
As time progressed, so did the method of lead extraction. Those involved in the battery breaking industry implemented the guillotine or hydrocleaver to break the batteries. By using this method, battery breakers were able to break open up to four (4) batteries at a time.
In the late 1960's, a polypropylene container replaced the rubber or tar-like casing. The guillotine and ax method became more difficult and less effective in removing the battery tops so high speed saws were utilized. Use of the high speed saws also caused more acid to spill and it was harder to control fugitive emissions. As a result, slow speed saws came to replace high speed saws, as fugitive emissions were easier to control and acid spills were lessened with the slow speed saws.
In the mid 1970's, Marjol melted down lead parts and posts and connectors. The melted parts would be stored in barrels, and the barrels would be stored on site until a full load was ready for shipment. The melting took place at the old crusher building and melting pot, which was connected to the bag house; an emissions control device which filtered any emissions coming off the pot. The melting pot was not always connected to the bag house, and this lack of connection at times caused the release of fugitive emissions into the atmosphere. The operation of the melting pot eventually stopped, after the Department of Environmental Resources informed Marjol that it should suspend all melting activities immediately.
MA Industries, a Georgia company whose prime product was polypropylene plastic liners for manhole covers, began experiencing a shortage of polypropylene. In order to solve this shortage, MA Industries developed a machine to crush the empty battery boxes which were discarded by the battery breakers. This process was commonly known in the industry as the MA machine, or the MA process. The MA machine implemented large, long hammers which were dropped onto a slated table which held batteries. The hammers would crush the battery parts held in between the table crevices.
Eventually, Marjol began using the MA process which utilized a liquid water separation method, in which the solid lead, lead oxide and rubber parts would fall to a tank and would be removed by a chain conveyor. The rubber parts would float to the top of the water, were picked up by a small chain conveyor, and were fed into a fan which blew the plastic parts into a trailer.
Due to the nature of the business itself, it was inevitable that lead was released into the atmosphere. The battery breaking business, by its nature, is a dirty business and in its early years the methods used were crude and resulted in particles, dust and fumes spreading over the land of those in the business and being carried off site either through air or by water, causing damage in surrounding neighborhoods.
An average car battery weighs approximately forty (40) pounds and contains twenty-two (22) pounds of lead. A battery breaker could recapture between 98% and 99% of the lead from a spent battery. Given this recapture rate, between 1,430,000 and 2,860,000 pounds of lead were not recovered annually at the site.
Marjol's methods were typical of the average breaker during its time of operation, having utilized all of the above mentioned processes for battery breaking and lead extraction at one time or another during its operations. However, technological advancement and size of the operation was anything but typical. Marjol was possibly the largest independent battery recycler in the United States in the mid 1970's, processing between 15,000 to 25,000 batteries a day, whereas a typical battery processing plant would process between 3,500 and 5,000 batteries a day. Estimates of the amounts processed at the site during its operation range from 929,574,549 to 1,201,305,722 pounds of batteries. Marjol utilized advanced sophisticated methods to break open the batteries in an effort to accelerate processing.
Most of the operations took place at the front of the property. Upon entering the site, trucks carrying spent batteries proceeded to the area of the office and scale. The load of batteries was weighed on a scale and transferred to the battery house. Many of the battery suppliers sent their batteries to Marjol because they knew what was entailed in breaking batteries, and did not want to perform such activities on their own site.
Ludmilla Varzaly, the bookkeeper for Marjol, would receive a slip of paper and a weight slip from the truck driver, indicating to which customer the driver belonged. Once she received a weigh-back slip (a slip indicating the weight of the load taken at the site's scales), an invoice slip would be written out, indicating the customer's name, the date of pick up, the identity of the load, the price and the dollar value. She would then await a "price per pound" amount from either Larry Fiegleman, the owner of Marjol, or Anthony Bonodio, the general manager of Marjol. Upon receipt of that information, a slip was drafted, and the slip would then be placed in the customer's unpaid file. Once the unpaid bill was going to be paid, checks were drafted and signed by Lawrence Fiegleman and/or Anthony Bonodio.
Shortly after the aforementioned intake process, Ludmilla Varzaly would also enter into the journals or ledgers (hereinafter the "Varzaly ledgers") the battery shipments received from different parties. Such entries included the name or abbreviation thereof, the date, the weight of the shipment, the check number and the dollar value of the purchased batteries. She would often abbreviate the names of the companies when she did the ledger entries, so "it would be easier." She "could do more, enter more, shortcut." She would be able to fit more information on the ledger. Sometimes she would use the first name of the corporate name or she would only write the first half of a long corporate name.
There are three (3) gap periods for which there are no Varzaly ledgers: 1961 through May of 1969; June 1970 through May 1971; and June 1976 through May 1979. All of the yearly designations were for the fiscal years.
In addition to the Varzaly ledgers, Marjol also kept general ledgers. The general ledgers would show the monthly total amounts purchased by Marjol. The general ledgers did not indicate from whom the batteries were purchased.
Once the tops of the batteries were removed at the battery house, the batteries were removed from the battery house by a chute. At the end of the chute, Marjol employees would literally dump the batteries, turning them upside down on a grated table in order for the lead plates to fall out. The battery cases were then thrown out to the back of the building.
When the battery tops were removed, acid was also released from the batteries. During the early years of operations, the acid was allowed to drain onto the earthen floor, and was then discharged onto the site after being neutralized with lime. The earthen floor was eventually replaced with a concrete floor, and in the mid 1970's an acid treatment plant was built to neutralize the waste acid.
The site also contained an erosion gully which carried battery casings and lead off the site. The battery casings contained lead and lead residue. The erosion gully drained into Sulphur Creek.
Battery casings were stockpiled in large ravines and pits remaining from the strip mining activities on the northeastern part of the site. In the mid to late 1970's, the battery casings eventually were buried, and the pits were filled in with contaminated soil. The soil, which had been removed in order to reach the underlying coal seam, became contaminated because it was left on site after having been extracted from the ravine. As a result, battery casings were buried in the strip pits, and were covered by contaminated soil. Once these strip pits were filled, battery casings were placed down slope to the south.
In the battery breaking industry, during the 1960's and 1970's, battery casings were typically either buried or crushed on site at some time after the lead was extracted. The casings were stored in an area on the sites, and bulldozers were run over the casings in order to crush them and reduce their size.
Over time, piles of battery casings at the Marjol site were permitted to grow in excess of the sides of the storage bins which had been erected for storage purposes. Lengths of the piles ranged from 150 feet to 250 feet. At times, the piles were too large to be covered. In the early years of operation, the disposed battery cases were not washed, so lead residue remained in the disposed battery casings. Eventually, Marjol began to wash the disposed battery casings, but some lead still remained. Lead was carried around and off of site from these piles by air, and rain water caused lead to be defused throughout the site and to the nearby Lackawanna River by run off water.
C. Contamination Of The Site And Surrounding Properties
The above described operations caused acid and lead spills. Such spills created potential hazards, and did cause lead particulate and acid to be distributed not only onto the site of the operations, but also onto adjoining private properties. Off site contamination occurred due to fugitive dust from the battery breaking and handling operations, the melting pot located on site, wind blowing over the site's contaminated ground surface, wind blowing over the piles of stored battery casings, the backfilling of strip pits with battery casings and contaminated soils, and filling low areas with battery casings. Lead particulate was also carried off site by tires on the trucks leaving the site, as well as surface water run off from the battery piles.
Initially, those in the business and general public were neither aware nor concerned of the dangers of lead, especially to persons. But those concerns began to surface in the late 1960's and early 1970's, and the concerns became so real that government regulators began to enforce and develop new regulations and to impose restrictions on battery breaking businesses around the country. The Pennsylvania DER was on the cutting edge of environmental regulation and its air pollution control program was one of a few it its kind in the country. During this time, air pollution regulation was brand new. As there was no perceived need for such equipment that regulated air pollution at that time, battery breakers had no true system to utilize in controlling fugitive emissions.
In May, 1967, the Air Pollution Control Association began working with Marjol on the abatement of lead particulate problems resulting from the site's operations. Sampling results indicated that the site was causing a lead problem in the surrounding area and that the sampling yields were cause for serious concern. Lawrence Fiegleman disputed the Association's sampling results, and contended that certain residents were tampering with the sampling structures, as there was animosity between him and the residents. At some point, James Chester, Regional Air Pollution Control Engineer and Secretary to the Association prior to DER's creation, determined that some of the samplers were in fact tampered with by the residents. The results of any sampler thought to have been tampered with were discarded or were not taken into consideration by DER.
At a 1968 meeting with James Chester, Lawrence Fiegleman indicated that he was desirous of creating an acceptable program under which lead emissions would be controlled by a closed system for lead melting. An order was entered by the Bureau of Air Pollution Control on March 7, 1969, ordering Marjol to reduce the emission of particulate matter from the site so that any emissions would not be detectible outside the site's property line. Marjol was also directed to submit a compliance plan which would comport with said order.
After three (3) notifications that Marjol was in violation of the 1969 order for not submitting a compliance plan, said plan was still not submitted by Lawrence Fiegleman or Marjol's attorney. A subsequent inspection to the site found no control equipment was installed Marjol was fined $ 300 for violating the 1969 order. Marjol appealed this fine, but later withdrew its appeal in lieu of an agreement to submit a compliance plan before November 1, 1970.
James Chester visited the site on November 5, 1970, at which time he determined that Marjol was in violation of the November 1, 1970 deadline for the 1969 order. Instead of the suggested installations being made, he determined that Marjol was constructing an entirely new production operation. Rather than controlling the original source of emission, Marjol was creating another source of emission by building new buildings and adding new production lines while keeping the original source in operation. Six (6) subsequent visits to the site revealed that control installations were not complete. On December 6, 1971, Marjol plead nolo contendere to two of the criminal charges that it had violated the 1969 order by repeated non-compliance.
On January 22, 1972, John Wilkes, Air Pollution Control Engineer, and Paul Gronka, an industrial hygienist for DER, visited the site. They discovered that holes had been cut into the duct work of one of the machines. Such actions negated the equipment's ability to effectively work. The holes were cut in order to speed up the processing of batteries. Such actions raised concern because it was the first time that any company in the state had engaged in such conduct. As a result of this, DER officials agreed to step up enforcement and investigations against Marjol, visiting the site from every two weeks to every month.
In December of 1970, published reports indicated that Marjol was the number two air polluter in Pennsylvania. Lawrence Fiegleman was aware of such accounts, but dismissed such reports as "another big lie", and believed that DER was lying.
2. blood lead tests, atmospheric samplings and the cease operations request
DER invoked the assistance of the Pennsylvania Department of Health in order to determine whether such readings posed a threat to public health. Blood lead tests were performed on children in the area, and test results revealed that several children had blood lead levels in excess of the limit for lead content as established by the Centers for Disease Control.
In accordance with department policy, the test results were sent to Marjol and Lawrence Fiegleman. He was informed that Marjol's operations were causing air pollution resulting in lead exposure in the neighboring residential area that was severe and beyond safe health limits. DER formally requested that all lead handling and processing operations be suspended until the source of emission was determined.
Lawrence Fiegleman's response to these statements was that DER had not proven anything. He did not think that "anything was wrong" with lead. He claimed that lead was not hazardous to one's health or to the environment: "Lead is the type of material that will go through your body. It will not stay." He indicated that, in his opinion, "whoever . . . says that lead is hazardous to somebody's health, whoever the person may be, that's their opinion. My opinion is that it isn't. I've been around it all my life."
Lawrence Fiegleman remained steadfast in his opinion that lead was not hazardous either to one's health or to the environment.
Marjol did not comply with DER's cease operation request, for Lawrence Fiegleman thought that "legally, Marjol wasn't doing anything wrong." He felt that if DER thought that what Marjol was doing was as hazardous as it had indicated, then DER would have gotten a court order and closed the site.
At this time, animosity between Lawrence Fiegleman and James Chester became worse. Letters complaining about James Chester were written by Marjol's attorney to Chester's superiors at the Department of Health and the Governor of Pennsylvania. Counsel for Marjol was of the opinion that James Chester was overstepping his bounds and was creating a "state of hysteria" in the Borough of Throop. Throughout James Chester's strained relationship with Lawrence Fiegleman, he was subjected to threats, ethnic slurs and attempted retaliations for his investigations of the site. Lawrence Fiegleman also contends that he was the brunt of ethnic slurs as well from James Chester. Their relationship remained strained. Lawrence Fiegleman was antagonistic, recalcitrant and uncooperative. He was inflexible and stubborn in his belief that lead was harmless.
Nothing came of Marjol's complaints concerning James Chester.
From November to December 1975, site inspections were performed. Five visits revealed uncovered storage piles. (Tr. Vol. IX, 03/11/97; p. 27-8). After samplings from neighboring residences yielded results in excess of 5 part micrograms per cubic meter (u g/m)
and after having taken into consideration the blood lead test results, DER issued another order dated January 27, 1976. Said order directed Marjol to, inter alia, cover all exposed battery casing piles and storage piles not in use, vacuum all paved areas and roadways, and take any other measures necessary to reduce the site's soil lead content to acceptable standards. This order primarily dealt with basic housekeeping issues necessary to prevent emissions. All management and housekeeping provisions were rudimentary and did not require invention of any new technology.
On July 26, 1977, DER issued another order to Marjol, directing it, inter alia, to not add any new piles of or add to the existing piles of battery cases, to cover the existing piles on site, and to begin removal of the battery cases. Subsequent visits to the site revealed that the piles were either partially covered, (defendants' exh. no. 284, 289; Tr. Vol IX, 03/11/97, p. 56), totally covered (defendants' exh. no. 284, 286, 289) or completely uncovered. (defendants' exh. no. 284, 285, 286; Tr. Vol IX, 03/11/97, p. 56-8). Covering the stockpiles and bins was of particular issue for DER, for they were a major source of emission.
Most of the sources of emission could have been controlled by the general housekeeping measures suggested by DER. The greater the release of particulate matter from the ...