The opinion of the court was delivered by: ROBERT KELLY, Senior District Judge
Presently before this Court is the Third Party Plaintiffs',
National Railroad Passenger Corporation ("Amtrak"), Southeastern
Pennsylvania Transportation Authority ("SEPTA") and Consolidated
Rail Corporation ("Conrail"), (collectively the "Rail
Companies"), Motion for Partial Summary Judgment on the Liability
of American Premier Underwriters, Inc. ("APU") under the
Comprehensive Environmental Response, Compensation, and Liability
Act ("CERCLA"), as well as under Pennsylvania's Hazardous Sites
Cleanup Act ("HSCA"). For the following reasons, the Rail
Companies' Motion will be granted.
I. INTRODUCTION AND FACTUAL BACKGROUND
The Rail Companies have brought this Motion for Partial Summary
Judgment against APU seeking to establish that APU is a liable
party under CERCLA and the HSCA. As stated by the Rail Companies,
they have brought their Motion at this time so as to "narrow the
issues remaining for trial." (Mem. Law in Supp. of Rail
Companies' Mot. for Partial Summ. J. on Liability of APU under
CERCLA and HSCA, at 2).
This case involves the liability and clean-up costs associated
with the Paoli Rail Yard and a surrounding 400-acre watershed
located in Chester County, Pennsylvania (collectively referred to
as "the Site"). The Paoli Rail Yard was used to repair, service
and store commuter railcars. As far back as 1950, these railcars
used fluids containing polychlorinated byphenyls ("PCBs") to cool
their transformers. The operation, repair, service and storage of
the railcars at the Paoli Rail Yard resulted in the release of
PCBs at the Site. One court recently noted the potential harmful
environmental and health effects of PCBs. Specifically:
PCBs can cause a variety of adverse health effects.
They are classified as suspected human carcinogens
and may damage the immune system, may cause
developmental problems in children and impair
reproductive systems. PCBs have been shown to cause
severe effects on exposed aquatic organisms and
wildlife, including suppression of immune responses,
impairment of reproduction and development,
disruption of endocrine function, cancer, and organ
enlargement and malfunction. Most PCBs do not degrade
very quickly in the environment, and they can persist
for many years in sediments, where they can cause
adverse effects, not only to individual organisms,
but also to entire aquatic populations.
United States v. Union Corp., 259 F. Supp.2d 356, 375 (E.D.
Pa. 2003) (internal citations omitted).
APU, by and through its predecessors, owned and operated the
Paoli Rail Yard from 1915 until April 1, 1976.*fn1 Pursuant
to the Rail Reorganization Act of 1973 (the "Act"), APU
transferred the Paoli Rail Yard to Conrail on April 1, 1976.
Conrail subsequently transferred ownership of the Paoli Rail Yard
to Amtrak on that same day. While Amtrak continues to own the
Paoli Rail Yard, Conrail operated the Rail Yard from April 1,
1976 until the end of 1982 when SEPTA took over the Rail Yard's
operation. SEPTA continued to use the Paoli Rail Yard until 1995
when it moved its maintenance operations to a different location.
From at least 1950 until 1986, fluids containing PCBs were used
at the Paoli Rail Yard. In 1986, the Environmental Protection
Agency ("EPA") filed an action against Amtrak, Conrail and SEPTA
in this District pursuant to the statutory provisions of CERCLA.
Specifically, the EPA sought injunctive relief and reimbursement
of costs in connection with the release of PCBs at the Site.
Later that year, the Commonwealth of Pennsylvania intervened as a
Plaintiff against the Rail Companies.
Also in 1986, the United States, Conrail and SEPTA petitioned
APU's Bankruptcy Court for permission to file a claim against
APU. See In re Penn Central Transp. Co., 944 F.2d 164, 166
(3d Cir. 1991). While APU opposed the petition, the United States
Court of Appeals for the Third Circuit ("Third Circuit") rejected
APU's argument that any CERCLA claim against it was discharged as
a result of its bankruptcy. Id. at 168. Thus, on August 12,
1992, the Rail Companies filed a Third-Party Complaint against
APU seeking to hold APU liable for its share of costs and
expenses relating to the PCB contamination at the Site.
Also in 1992, the United States filed a Complaint against APU
seeking to hold them liable for the PCB contamination. During
this time, the Rail Companies cooperated with the government to
clean-up the Site. For example, under a third partial preliminary
consent decree, the Rail Companies conducted a remedial
investigation to determine the extent of PCB contamination at the
Site and a feasibility study of various remedial alternatives.
Additionally, under other partial preliminary consent decrees,
the Rail Companies agreed to conduct a soil sampling program to
determine the extent of PCB contamination in the residential
areas and the surface water channels as well as agreed to
excavate approximately 3,500 cubic yards of contaminated soils
from the residential areas north of the Paoli Rail Yard.
Furthermore, in 1990, the EPA placed the Site on the National
Priorities List. The EPA then issued a Record of Decision ("ROD")
in July of 1992, which reviewed remedial alternatives and their
projected costs and selected remedies for the Site. As modified,
the ROD required: 1) excavation and on-site treatment of
contaminated rail yard soils; 2) ground water treatment and fuel
oil recovery; 3) decontamination and demolition of rail yard
buildings and structures; 4) excavation of contaminated
residential soils and 5) excavation of contaminated stream
sediments. Then, in 1995, the EPA proposed a sixth consent decree
which required the Rail Companies and APU to implement the
requirements set forth in the ROD for the remediation of the
Paoli Rail Yard.
The Rail Companies agreed to the terms of a final consent
decree, and on July 28, 1997, the United States filed a Praecipe
to Lodge Consent Decree (the "Final Consent Decree") that
resolved the Rail Companies' liability to the United States and
the Commonwealth of Pennsylvania for the contamination at the
Site. APU did not agree to this Final Consent Decree and
continued with the litigation. The terms of the Final Consent
Decree gave the Rail Companies significant contribution
protection. APU argued that CERCLA did not authorize the
contribution protection provided for in the Final Consent Decree
to the Rail Companies and that the Final Consent Decree was
substantively unfair. However, in 2000, the Third Circuit
rejected APU's arguments and affirmed this Court's approval of
the Final Consent Decree. See United States v. Southeastern
Pa. Transp. Auth., 235 F.3d 817 (3d Cir. 2000). Currently, the
Rail Companies have motioned this Court to hold that APU is
liable under CERCLA and the HSCA so as to streamline their claims
for contribution against APU.
Pursuant to Rule 56(c) of the Federal Rules of Civil Procedure,
summary judgment is proper "if there is no genuine issue as to
any material fact and the moving party is entitled to judgment as
a matter of law." FED. R. CIV. P. 56(c). Essentially, the inquiry
is "whether the evidence presents a sufficient disagreement to
require submission to the jury or whether it is so one-sided that
one party must prevail as a matter of law." Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 251-52 (1986). The moving party has
the initial burden of informing the court of the basis for the
motion and identifying those portions of the record that
demonstrate the absence of a genuine issue of material fact.
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). An issue is
genuine only if there is a sufficient evidentiary basis on which
a reasonable jury could find for the non-moving party.
Anderson, 477 U.S. at 249. A factual dispute is material only
if it might affect the outcome of the suit under governing law.
Id. at 248.
To defeat summary judgment, the non-moving party cannot rest on
the pleadings, but rather that party must go beyond the pleadings
and present "specific facts showing that there is a genuine issue
for trial." FED. R. CIV. P. 56(e). Similarly, the non-moving
party cannot rely on unsupported assertions, conclusory
allegations, or mere suspicions in attempting to survive a
summary judgment motion. Williams v. Borough of W. Chester,
891 F.2d 458, 460 (3d Cir. 1989) (citing Celotex, 477 U.S. at 325
(1986)). Further, the non-moving party has the burden of
producing evidence to establish prima facie each element of its
claim. Celotex, 477 U.S. at 322-23. If the court, in viewing
all reasonable inferences in favor of the non-moving party,
determines that there is no genuine issue of material fact, then
summary judgment is proper. Id. at 322; Wisniewski v.
Johns-Manville Corp., 812 F.2d 81, 83 (3d Cir. 1987).
It is important to note what the Rail Companies are seeking to
establish by filing this Motion for Partial Summary Judgment on
the Liability of APU under CERCLA and the HSCA. This Motion is
not seeking to establish that APU owes the Rail Companies a sum
certain on the Rail Companies' contribution claims arising from
the Paoli Rail Yard clean-up. Rather, this Motion is simply
seeking to streamline the litigation so as to establish that APU
can be considered a liable party under CERCLA and the HSCA. This
Court finds that bringing this Motion at this time only as to the
issue of liability under CERCLA and the HSCA is proper. For
example, one court has noted that:
[l]iability may be decided first before the more
complicated questions implicated in clean-up
measures, which include fixing the proportionate
fault of liable parties. Bifurcation and summary
judgment provide powerful legal tools which, by
effectively isolating the issues to be resolved,
avoid lengthy and perhaps needless litigation.
United States v. Alcan Aluminum Corp., 990 F.2d 711
, 720 (2d
Cir. 1993). This Court agrees with the Rail Companies that their
Motion as to the liability of APU is properly before this Court
at this time.
First, this Court will analyze whether APU is a liable party
under CERCLA. Next, this Court will analyze whether APU is a
responsible party under the HSCA. Finally, this Court will
examine APU's arguments opposing the Rail Companies' Motion. It
should be noted at the outset that APU's arguments do not
specifically address the elements under CERCLA and the HSCA, but
instead attempt to argue that the Rail Companies' Motion should
be denied on other grounds. As such, for the reasons that follow,
APU's arguments do not impact this Court's analysis of the
required elements to establish liability under CERCLA or the
HSCA. For the following reasons, APU is a liable and responsible
party under both CERCLA and the HSCA.*fn2 Therefore, the
Rail Companies' Motion will be granted.
A. APU'S CERCLA LIABILITY
The Rail Companies' claims against APU are for contribution
arising out of the Paoli Rail Yard clean-up. CERCLA provides for
contribution costs. Specifically, "[a]ny person may seek
contribution from any other person who is liable or potentially
liable under section 9607(a) of this title, during or following
any civil action under section 9606 of this title or under
9607(a) of this title." 42 U.S.C. § 9613(f)(1). Thus, for the
Rail Companies to properly seek contribution from APU, APU must
be considered a liable party under Section 9607(a). As the Third
Circuit has noted:
[a] plaintiff must meet four elements to establish
CERCLA liablility: (1) that hazardous substances were
disposed of at a "facility"; (2) that there has been
a "release" or" threatened release" of hazardous
substances from the facility into the environment;
(3) that the release or threatened release has
required or will require the expenditure of "response
costs"; and (4) that the defendant falls within one
of four categories of responsible parties.
United States v. CDMG Realty Co., 96 F.3d 706
, 712 (3d Cir.
1996) (citations omitted). "If these requirements are met,
responsible parties are liable for response costs regardless of
their intent." Id. (citing United States v. Alcan Aluminum
Corp., 964 F.2d 252
, 259 (3d Cir. 1992)). Thus, to be considered
a liable party under CERCLA, the Rail Companies must show that
APU meets all four requirements.
1. PCBs were disposed of at the Site
The first step in finding a party as liable under CERCLA is to
show that hazardous substances were disposed of at a "facility."
There is little doubt that this requirement is satisfied as it
relates to APU. First, PCBs are classified as hazardous
substances purusant to 42 U.S.C. § 9601(14). See United States
v. Penn Central Corp., No. 86-1094, 2004 WL 35780, at *1 n. 1
(E.D. Pa. Jan. 8, 2004) (stating PCBs are classified as hazardous
substances under CERCLA). Second, even APU readily admits that
"PCBs were used and disposed of at the Paoli [Rail Yard] for some
period of APU's predecessors ownership and operation of the
[Paoli Rail Yard]." (APU's Mem. in Opp'n to Mot. of Rail
Companies for Part. Summ. J. on the Liability of APU under CERCLA
and HSCA, at 2). Third, the Paoli Rail Yard clearly falls within
the definition of a "facility" under CERCLA. CERCLA defines
facility as "any site or areas where a hazardous substance has
been deposited, stored, disposed of, or placed, or otherwise come
to be located; but does not include any consumer product in
consumer use or vessel." 42 U.S.C. § 9601(9)(B). Thus, since APU
readily admits that PCBs ...