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Supreme Court Holds That CERCLA Contribution Claims Are Triggered by Resolution of Express CERCLA Liability

Posted: 05/26/2021
Services: Environmental | Environmental, Social and Governance (ESG)

This week the Supreme Court decided Territory of Guam v. United States, No. 20-382 (U.S. May 24, 2021), and held that contribution claims under section 113(f)(3)(B) of the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), 42 U.S.C. § 9613(f)(3)(B) are only permitted in cases where there has been “resolution of a CERCLA-specific liability.”  

The United States Navy constructed the Ordot Dump in Guam during the 1940s and allegedly disposed of toxic waste there for decades before ceding control of the landfill to Guam. EPA sued Guam under the Clean Water Act for remediation of the site and settled the matter in 2004 when Guam entered into a Clean Water Act consent decree.  

Thirteen years after entry of the consent decree, Guam sought to recover costs of the cleanup from the Navy by suing under §107 of CERCLA for cost recovery and under §113 for contribution. 42 U.S.C. § 9607, 9613. The lower court found that this created statute of limitations issues for Guam because more than three years had passed since the consent decree resolved Guam’s liability. In a unanimous decision, the Supreme Court reversed because the EPA settlement was for Clean Water Act claims, not CERCLA liability and CERCLA liability must be resolved to trigger a CERCLA contribution action.

The Supreme Court did not expressly address the interplay of §107 and §113 of CERCLA, but noted that the D.C. Circuit held that a party cannot assert a §107 cost recovery claim if it has a §113 contribution claim. With the elimination of Guam’s contribution claim, the case was remanded for further proceedings that will presumably address Guam’s CERCLA §107 cost recovery claims.

The lesson learned from this decision is that if you do not include an express reference to resolution of CERCLA liability in settlement agreements with state or federal agencies that encompass claims that could have been asserted under CERCLA, you may not have a CERCLA contribution claim. The decision also reinforces the importance of being cognizant of the statute of limitations for CERCLA contribution claims and understanding the difference between §107 cost recovery claims and §113 contribution claims.