Superfund Cleanups – Can the State Courts Impose Cleanup Standards, or Does the EPA Get the Final Word?

The United States Supreme Court decided a case last week that has ramifications for property owners, particularly residential property owners, whose land has been contaminated. The case, Atlantic Richfield Co. v. Christian,[1] involves whether state courts can adjudicate contamination lawsuits that are already subject to cleanups being administered by the U.S. Environmental Protection Agency (EPA) under the 1980 Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA),[2] also commonly known as Superfund. Unfortunately, these statutes are notoriously complicated, and “the question whether CERCLA allows state courts to entertain suits like the one in this case depends on the interpretation of devilishly difficult statutory provisions,” according to Justice Alito.[3]

The case stems from a Superfund site cleanup of the Anaconda Copper Mining Company and its three copper smelters, built between 1884 and 1902 near Butte, Montana.   Atlantic Richfield took over operations in the 1970s.  By 1980, the smelters were closed, after releasing arsenic and lead throughout the area for nearly one hundred years. By 1983 the EPA had “designated an area of more than 300 square miles around the smelters as one of the inaugural Superfund sites.”[4] The cleanup continues now, some 37 years later, and “Atlantic Richfield estimates that it has spent roughly $450 million implementing EPA’s orders.”[5]

The issue for the 98 landowners who are involved in this lawsuit is the extent to which their properties should be remediated. The EPA’s approved cleanup plan set a Soil Maximum Contaminant Level (MCL) of 250 parts per million (ppm) for arsenic. The landowners propose to set the arsenic MCL at 15 ppm. As Justice Gorsuch notes, “even 100 ppm is sometimes considered too toxic for local landfills, and the federal government itself has elsewhere set a threshold of 25 ppm, [and some] States set residential cleanup levels as low as 0.04 ppm.”[6]

The EPA also required excavation and removal of the top one foot of soil on the properties, while the landowners seek excavation and removal of the top two feet of contaminated soil. “The landowners also seek to capture and treat shallow groundwater through an 8,000-foot long, 15-foot deep, and 3-foot wide underground permeable barrier” to ensure safe drinking water, a plan the EPA rejected as too costly. Together, the landowners’ additional remediation plans are estimated to cost Atlantic Richfield an additional $50 – $58 million.[7]

The landowners brought their lawsuit against Atlantic Richfield in Montana state court, where it was eventually elevated to the Montana Supreme Court. The landowners alleged various claims under common law against Atlantic Richfield, including trespass, nuisance, and strict liability, and sought to recover restoration damages and other forms of relief. Atlantic Richfield challenged the jurisdiction of the Montana Supreme Court to hear the case under CERCLA. The Montana Supreme Court rejected Atlantic Richfield’s argument, ruled in favor of the landowners and permitted the case to proceed to trial. Atlantic Richfield petitioned the United States Supreme Court, and that Court accepted the case.

The United States Supreme Court’s decision in the case is somewhat of a split victory for the landowners and for Atlantic Richfield. First, in a victory for the landowners, the Court held that CERCLA does not block the Montana Supreme Court (or other state courts for that matter) from resolving lawsuits regarding common law claims such as trespass, nuisance, and strict liability, claims that do not arise directly under the CERCLA statute. This holding will permit the landowners case to move forward in Montana state courts, and potentially other cases in other state courts.

The second issue decided by the Court is more a minor victory for Atlantic Richfield, and potentially other persons or corporations responsible for widespread contamination affecting innocent landowners. Somewhat counterintuitively, the Court held that landowners are Potentially Responsible Parties (PRPs), a statutory term that refers to those landowners who may be potentially liable for site remediation costs, despite the fact that the landowners did not cause the contamination. This is the result of the broad language used in the CERCLA statute, which defines “Covered Persons” (i.e. PRPs) as, in part, “the owner and operator of a … facility.”[8] “Facility” is further defined as “any site or area where a hazardous substance has been deposited …, placed, or otherwise come to be located.”[9]

The end result of the Court holding that the landowners are Potentially Responsible Parties is not that innocent residential landowners are now likely to be pursued by EPA for site cleanup costs for their contaminated properties caused by others. The Court, in fact, notes that the EPA has long had a policy in which it does not seek to recover costs from residential landowners who are not responsible for contamination. However, the Court has determined that if parties seek to impose additional cleanup measures beyond what EPA has determined to be necessary under CERCLA, the landowners must “first obtain approval from EPA for the remedial work they seek to carry out.”[10] This holding is also read from the statute, which states that, “When either the President, or a [PRP] pursuant to an administrative order or consent decree under this chapter, has initiated a remedial investigation and feasibility study for a particular facility under this chapter, no [PRP] may undertake any remedial action at the facility unless such remedial action has been authorized by the President,”[11] or the President’s designee, here the EPA.

The EPA had already set a remediation threshold for Atlantic Richfield, so it is yet to be determined whether EPA will permit this additional remediation that the property owners are seeking (although it seems unlikely given that a level is already set). Nevertheless, the Court held that the Montana courts may still determine whether Atlantic Richfield remains “potentially liable under state law for compensatory damages, including loss of use and enjoyment of property, diminution of value, incidental and consequential damages, and annoyance and discomfort.”[12] Consequently, Atlantic Richfield is not completely off the hook.

This ruling is likely to affect landowners throughout the U.S. who may be dealing with contaminants on their property that were released or caused by another person or business. In Wisconsin alone, there are currently 36 sites listed on the EPA’s Superfund National Priority List (NPL)[13] – the listing of sites that are continuing to undergo site contamination remediation under CERCLA – and there are dozens more sites listed throughout the country. There are also many more site cleanups that are administered at the state level, in Wisconsin by the Department of Natural Resources. In summary, residential landowners may continue to pursue remedies in state courts for common law actions such as trespass and nuisance claims against other parties responsible for environmental contamination. However, if a property owner seeks to impose a cleanup standard that is greater than that imposed by the EPA as part of a Superfund site remediation plan, it must first obtain the approval of the EPA to conduct that additional cleanup.

If you have questions or concerns regarding environmental contamination on a property, please contact us to determine your obligations and responsibilities. Time may be of the essence.

[1] Atlantic Richfield Co. v. Christian, Docket No. 17-1498, 590 U.S. ___ (April 20, 2020).

[2] 42 U.S.C. § 9601 et seq.

[3] See Id., JUSTICE ALITO, concurring in part and dissenting in part, at 2.

[4] See Id., Opinion, at 4.

[5] See Id.

[6] See Id., JUSTICE GORSUCH, with whom JUSTICE THOMAS joins, concurring in part and dissenting in part, at 2.

[7] See Id., Opinion, at 6.

[8] 42 U.S.C. § 9607(a)(1)

[9] 42 U.S.C. § 9601(9)

[10] Atlantic Richfield at 20.

[11] CERCLA Section 122(e)(6), 42 U.S.C. § 9622(e)(6).

[12] Id. at 19.

[13] As of October 2019, the most recently published listing by the Wisconsin DNR. See WDNR Document RR-005, WISCONSIN SITES ON THE NATIONAL PRIORITIES LIST (NPL), 10/7/2019. https://dnr.wi.gov/topic/brownfields/superfund.html