Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

COMMONWEALTH OF PENNSYLVANIA v. CONCEPT SCIENCES

December 2, 2002

COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL PROTECTION, PLAINTIFF
V.
CONCEPT SCIENCES, INC.; PPT RESEARCH, INC.; IRL E. WARD, JR.; BRIAN D. HEATH; LEHIGH VALLEY REALTY, III; JAMES H. READINGTON; JOHN ADAMS; ESTATE OF JACOB QUICK C/O JUDITH QUICK, DEFENDANTS



The opinion of the court was delivered by: Michael M. Baylson, United States District Judge.

MEMORANDUM

The issue presented concerns the adequacy of allegations of corporate successor liability for environmental cleanup costs. This case, which seeks reimbursement for environmental cleanup costs, was commenced by Plaintiff, the Commonwealth of Pennsylvania Department of Environmental Protection ("Plaintiff") against the following defendants: Concept Sciences, Inc. ("CSI"); PPT Research, Inc. ("PPT"); Irl E. Ward, Jr. ("Ward"); Bryan D. Heath ("Heath"); Lehigh Valley Realty, III; James H. Readington; John Adams; and Estate of Jacob Quick do Judith Quick. The Complaint contains three counts brought under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq.; the Pennsylvania Hazardous Sites Cleanup Act ("HSCA"), 35 Pa. Cons. Stat. Ann. 6020.101 et. seq. and the Pennsylvania Declaratory Judgments Act, 42 Pa. Cons. Stat. Ann. 7531 et seq.

Plaintiff seeks reimbursement of its costs allegedly incurred in response to the release and threat of release of hazardous substances at the CSI Site in Hanover Township, Lehigh County, Pennsylvania (the "Site"), and a declaratory judgment on liability for response costs that will be binding on any subsequent actions by Plaintiff to recover future response costs incurred in connection with the Site. (Pl's Compl. ¶ 1). Presently before this Court is Defendant PPT's Motion to Dismiss. All other Defendants have answered the Complaint. For the reasons stated below, the Motion will be denied.

I. Background

Plaintiff alleges that an explosion on February 19, 1999, at a facility owned by CSI and located on the Site resulted in the release and threat of release of hazardous substances and contaminants, and that Plaintiff incurred costs to implement, operate, and maintain a containment system to ensure no further release of hazardous substances or contaminants. (Pl's. Compl. ¶ 18, 28-29). Plaintiff further alleges that, due to the threat to human health and the environment, it was required to demolish CSI's facility and dispose of hazardous substances and contaminants from the facility. Id. at ¶¶ 32, 39.

With respect to Defendant PPT, Plaintiff alleges that PPT is a successor corporation to CSI under the substantial continuity theory and makes the following assertions in support of its claim:

82. PPT is a successor corporation to CSI under the substantial continuity theory as applied by this Court. Atlantic Ridgefield Co. v. Blosenski, 847 F. Supp. 1261 (E.D. Pa. 1994); United States v. Atlas Minerals & Chems., Inc 824 F. Supp. 46 (E.D. Pa. 1993).
83. By letter to CSI's counsel dated March 31, 1999, CSI was informed that it may be a responsible person pursuant to section 701(a)(1) of HSCA, and that it could be responsible for the cost of any environmental investigations or cleanup actions at the Site.
84. PPT purchased the assets of CSI almost one year after CSI was informed in writing that it could be responsible for the cost of any environmental investigations or cleanup actions at the Site.
85. At the time PPT purchased the assets of CSI, PPT had knowledge or should have had knowledge of CSI's liability to the Department pursuant to CERCLA and HSCA.
86. As a successor corporation to CSI, PPT is subject to the liability of an "operator" at the Site within the meaning of section 101(20) of CERCLA, 42 U.S.C. § 9601 (20).
107. As a successor corporation to CSI, PPT is subject to the liability of an "operator" at the Site within the meaning of sections 103 and 701(a)(1) of HSCA, 35 P.S. §§ 6020.103 and 6020.701(a)(1).

(Pl.'s Compl. ¶¶ 82-86, 107).

II. Legal Standard and Jurisdiction

When deciding a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), the Court may look only to the facts alleged in the complaint and its attachments. Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir. 1994). The Court must accept as true all well-pleaded allegations in the complaint and view them in the light most favorable to the plaintiff. Angelastro v. Prudential-Bache Sec., Inc., 764 F.2d 939, 944 (3d Cir. 1985). A Rule 12(b)(6) motion will be granted only when it is certain that no relief could be granted under any set of facts that could be proved by the plaintiff Ransom v. Marrazzo, 848 F.2d 398, 401 (3d Cir. 1988).

This Court has subject matter jurisdiction over the claims asserted in Count I pursuant to 28 U.S.C. § 1331, and supplemental jurisdiction over the claims asserted in Counts II and III pursuant to 28 U.S.C. § 1367. Venue is appropriate under 28 U.S.C. § 1391(b), (c).

III. Analysis

A. Federal Claim

1. Plaintiff Has Stated a Claim that PPT is a Successor Corporation to CSI and Liable Under CERCLA

This Court has recognized the applicability of the "substantial continuity" or "continuity of enterprise"*fn1 test in CERCLA proceedings to determine if corporate successors are liable for their predecessor's environmental liabilities. United States v. Exide Corporation, C.A. No. 00-3057, 2002 U.S. Dist. LEXIS 3303 (E.D. Pa. Feb. 27, 2002); Elf Antochem North America v. United States and Witco Corp., 908 F. Supp. 275 (E.D. Pa. 1995); Atlantic Richfield Co. v. Blosenski, 847 F. Supp. 1261 (E.D. Pa. 1994) (Giles, J.)); United States v. Atlas Minerals and Chems. Inc., 824 F. Supp. 46 (E.D. Pa. 1993) ("Atlas I") (Cahn, J.)). These decisions are consistent with the Third Circuit's holding that successor companies may be held liable for CERCLA liabilities by their predecessors. Aluminum Company of America v. Beazer East. Inc., 124 F.3d 551, 565 (3d Cir. 1997) (citing Smith Land & Improvement Corp. v. Celotex Corp., 851 F.2d 86, 91-92 (3d Cir. 1988), cert. denied, 488 U.S. 1029, 109 S. Ct. 837, 102 L.Ed.2d 969 (1989)). Although it has specifically upheld the concept of successor liability in CERCLA, the Third Circuit has not reviewed the district courts' use of the substantial continuity test to determine whether a corporation is subject to such ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.