Third Time May Be The Charm in the Lower Fox River PCB Superfund Matter

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[author: Robert S. Sanoff]

It’s always satisfying to find an open-minded judge who is willing to change his decision when he is shown to be wrong, but Judge Greisbach of the Eastern District of Wisconsin may be crossing the line from open-mindedness into a chronic inability to make up his mind.  In the past 9 months, Judge Greisbach has issued three separate decisions in US v. NCR on the subject of whether a party, Appleton Papers, Inc., which purchased assets from an alleged polluting party, NCR Corp., can be held to have successor liability under CERCLA with respect to the PCB contamination of the Lower Fox River. 

To recount the bidding, Judge Greisbach initially held in July of 2011 that the government could not establish successor liability against a purchaser of assets where the seller of assets, who apparently caused the releases of hazardous substances, remained a viable CERCLA defendant.  In December of 2011, Judge Greisbach reversed himself on the dubious basis that none of the CERCLA cases expressly held that a purchaser of assets could not be held liable where the seller of assets was still a viable defendant.  In a blog post at the time, I noted that the reversal seemed driven not by the legal merits but by the Court’s desire to solve the practical problem that the United States could not get the site cleaned up unless it could issue an enforceable order to Appleton. 

Apparently recognizing that his December reversal was legally untenable, Judge Greisbach has again revisited the issue of Appleton’s CERCLA liability and issued a new decision reversing himself again.  This time Judge Greisbach appears to have gotten it right.  After carefully reviewing the language in the 1978 contract between the parties, he concludes that the contract is not broad enough to transfer liability under a statute that had not yet been enacted with respect to contamination at site that had not yet been identified. 

At one level, the lesson of this case is: keep trying -- you may eventually get it right.  But the more important lesson is that CERCLA liability decisions should be based on the legal merits of the claim and not on a willingness to stretch legal standards to solve the exigencies of facilitating site cleanups.  The legal history of Superfund is littered with wrongly decided cases driven more by a desire to ensure cleanups than to effect justice.