U.S. Supreme Court Narrows Scope of Superfund Liability


The United States Supreme Court has ruled that only persons who take intentional steps to dispose of a hazardous substance qualify for liability as an "arranger" under the federal Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"). In an 8-1 decision, the Court in Burlington Northern & Santa Fe Railway Co. v. U.S., adopted a narrow definition of "arranger" and, at the same time, endorsed an allocation method that could reduce the chances a responsible party might be held liable for all cleanup costs at a site.

The case arose after numerous pesticide releases contaminated soil and ground water at a chemical distribution business in Arvin, California. Shell sold the pesticides to the distributor and Burlington Northern and other railroads owned a part of the property occupied by the facility. During its 28 years of operation, contaminations resulted from delivery spills, equipment failures, and rinsing of tanks and trucks. The California and federal environmental regulators spent approximately $8 million in response costs and ordered the railroads to undertake further cleanup at a cost of $3 million.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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