PHILIP R. MARTINEZ, District Judge.
On this day, the Court considered the testimony and evidence presented by Plaintiff ASARCO LLC and Defendants CEMEX, Inc. and CEMEX Construction Materials South, LLC at a trial conducted before the Court from July 26 to August 1, 2013, in the above-captioned cause. The issue before the Court at trial was Plaintiffs claim for contribution pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") and the Superfund Amendments and Reauthorization Act. After careful consideration of the testimony and evidence, the Court makes the following findings of fact and conclusions of law pursuant to Federal Rule of Civil Procedure 52(a).
The United States International Boundary and Water Commission ("USIBWC") oversees the administration of various treaties between the United States and Mexico, specifically those dealing with water distribution and flood control. Trial Tr. vol. I, at 159, July 26, 2013. At its site in El Paso (the "USIBWC Site"), the USIBWC oversees the diversion of water from the Rio Grande River to the American Canal (the "Canal"), a two-mile canal that the United States uses to remove its agreed-upon allotment of water from the river. Parties' Stip. Facts ¶ 34, July 25, 2013, ECF No. 169.
The USIBWC Site, which is located at 2616 W. Paisano Drive, comprises 5.8 acres that include the area surrounding the Dam and Canal as well as the American Dam Field Office Property. Parties' Stip. Facts ¶¶ 1, 33.
Plaintiff ASARCO, LLC ("Asarco") is a limited liability company organized under the laws of the state of Delaware. Parties' Stip. Facts ¶ 2. From 1887 to 1999, Asarco operated various metal-smelting plants at its site in El Paso (the "Former Asarco Site"), which is located just east of the USIBWC Site. Defs.' Ex. 51 § 2.1-.2; see id. fig. 2-1. In 2005, Asarco declared Chapter 11 bankruptcy in the Southern District of Texas. Id. § 2.2. During bankruptcy proceedings, the United States (the "Government") filed a proof of claim on behalf of the USIBWC to resolve Asarco's joint-and-several CERCLA liability for "[r]esponse costs [that] have been and will be incurred by EPA at [the USIBWC Site] not inconsistent with the National Contingency Plan." Pl.'s Ex. 9, ¶ 1; see id. H 194. In a settlement agreement approved by both the bankruptcy court and the district court, Asarco agreed to settle the claim— originally for twenty-seven million dollars—for nineteen million dollars. Parties' Stip. Facts ¶¶ 26-32. Asarco eventually paid the Government over twenty-two million dollars to resolve its liabilities in full, including interest. Id. ¶ 31; Trial Tr. vol. I, at 34; see Defs.' Ex. 31, at 9-10.
Remediation of the USIBWC Site has not yet occurred, nor have bids been issued for the work. Trial Tr. vol. I, at 184. It is thus unclear whether Asarco's settlement amount will be sufficient to pay for full remediation of the Site. The testimony of Gilbert Anaya, the supervisor of the USIBWC's Environmental Management Division, was not clear on this point: while he first stated that he did not know whether the funds from Asarco would pay for one hundred percent of the remediation of the Canal and Dam, id. at 179, he later stated that they would be enough, id. at 182. The Court thus determines that it does not have sufficient evidence to make a conclusive finding of fact on this issue.
Defendant CEMEX, Inc. is a Louisiana corporation; Defendant CEMEX Construction Materials South, LLC ("CEMEX Construction") is a limited liability company organized under the laws of the state of Delaware.
SWPCC also owned and operated a limestone quarry called the Toro Quarry (the "Quarry") until 1986. Parties' Stip. Facts ¶¶ 7, 11. The Quarry was later purchased
Both the Quarry and the Plant, collectively known as the "CEMEX Site," are located approximately a quarter mile from the northern boundary of the USIBWC Site, to the east of the Rio Grande and immediately north of Asarco's property.
Asarco alleges that operations at the CEMEX Site contributed arsenic to the contamination at the USIBWC Site, and thus that CEMEX is responsible for a portion of the settlement amount paid by Asarco to the Government. First Am. Compl. ¶ 14, Mar. 22, 2013, ECF No. 50. Specifically, Asarco brings this CERCLA contribution claim against CEMEX for eleven million dollars, which it alleges constitutes CEMEX's share of the cleanup costs at the USIBWC Site. Pl.'s Post-Trial Br. Supp. Damages & Allocation 28, Aug. 30, 2013, ECF No. 207.
CEMEX and its predecessors in interest, including SWPCC and JCPI, have quarried limestone at the Quarry since approximately 1910. Trial Tr. vol. III, at 64 (testimony of Kimberly Dennis). The parties agree that limestone contains arsenic, e.g., id. at 84, and CEMEX's designated representative, Kimberly Dennis, acknowledged that the Quarry contains both lead and arsenic, id. In addition, CEMEX concedes that the quarrying process and related activities, such as transportation, can result in fugitive emissions that contain arsenic. Id. at 82-83; Trial Tr. vol. V, at 111-12 (testimony of Dr. Theresa Bowers); see also Pl.'s Ex. 55, at P-55-4 ("The rock crusher facility onsite currently has a notice of violation for fugitive dust emissions.").
The parties' disputes with respect to the Quarry center on two issues of fact: (1) whether emissions from the Quarry contain an appreciable amount of arsenic, such that the emissions could have contributed to the contamination at the USIBWC Site, and (2) whether water—either surface or ground—flows from the Quarry to the USIBWC Site, such that it may have transported contaminants to the Site.
Several environmental assessments conducted at the Quarry note various materials that may have been dumped on the site, including piles of dust, some of which may be cement kiln dust ("CKD").
CEMEX's expert witnesses on air emissions and soil contamination both testified that fugitive emissions from the Quarry were not responsible for any contamination of the USIBWC Site. Dr. John Richards, CEMEX's air-emissions expert, testified that while he had not tested the materials at the Quarry, he believed that any emissions from the Quarry would be "too small to be relevant." Trial Tr. vol. V, at 43-44. Similarly, he stated in his report that, "[b]ased on [his] experience in testing unpaved roads, limestone crushers, and storage piles," emissions from the Quarry "are not credible contributors" to the arsenic levels at the USIBWC Site. Defs.' Ex. 49, at 3. Dr. Theresa Bowers, CEMEX's soil-contamination expert, testified that fugitive emissions from the Quarry would contain arsenic concentrations well within natural-background levels.
Asarco did provide some evidence indicating that surface-water runoff from the Quarry may end up in the Rio Grande: Anaya testified that, from his own personal knowledge, there are arroyos on the Quarry property that would channel surface water toward the river. Trial Tr. vol. I, at 162. Additionally, the 1981 environmental
The 1992 environmental assessment of the Quarry notes that, while surface water on the property generally drains toward the southwest, quarrying activities "have substantially altered the terrain in some areas." Pl.'s Ex. 36, at P-36-7. Indeed, it appears from the reports provided that at least some of the surface water on the property flows into Cement Lake, an unlined retention pond located in the northwest portion of the Quarry. See Trial Tr. vol. III, at 58; Pl.'s Ex. 55, at P-55-4, P-55-7. The 1992 assessment reports that no offsite discharge occurs from Cement Lake. Pl.'s Ex. 55, at P-55-4.
CEMEX's groundwater expert, Mark Hemingway, testified that, to a reasonable degree of scientific certainty, the Quarry is not a source of groundwater contamination at the USIBWC Site. Trial Tr. vol. V, at 173, 196. Groundwater at the Quarry, he testified, shows no signs of elevated arsenic content: rather, testing in the Quarry has identified arsenic levels consistent with natural-background levels, not contamination. Id. at 172, 185. In addition, he testified to the lack of evidence of any direct migration pathway between the Quarry and the USIBWC Site. Id. at 185, 190. His testimony indicated that the groundwater beneath the Quarry travels in a "separate, distinct path" along Executive Drive to the Rio Grande. Id. at 194-95; Defs.' Ex. 47, fig. 3. As a result, he concludes, even were "arsenic-impacted groundwater" present on the Quarry, "it would not migrate to" the USIBWC Site. Defs.' Ex. 47, at 3. Asarco presented no evidence otherwise: while its surface-water expert, Kenneth Ames, testified about the groundwater at and around the American Dam and Canal, he rendered no opinions as to the groundwater beneath the Quarry. See Trial Tr. vol. IV, at 181-82, 217.
The Plant is a dry-process plant that SWPCC used to produce cement from approximately 1910 to 1985. See Trial Tr. vol. III, at 68-69. The Plant was built with two kilns; two more were added at a later date. While the kilns' precise dates of operation are unclear, the amount of cement produced at the Plant suggests that some of the kilns ran continuously during the whole seventy-five-year period that the Plant was in service. Id. at 75, 106, 119.
Much of Asarco's case is based on information found in a 1989 "Environmental Site Inspection" conducted by Raba-Kistner (hereinafter the "Report") on behalf of Stanley Jobe, who at that time was considering purchasing the Plant property. Trial Tr. vol. II, at 52; see Pl.'s Ex. 52. Asarco characterizes the Report as a smoking gun, while CEMEX insists it is the result of a cursory "look-see" from which no concrete conclusions can be drawn. Compare Trial Tr. vol. II, at 164, with id. at 94-95.
Raba-Kistner did not test the "kiln dust" for arsenic, nor did it confirm through testing that the dust was indeed CKD rather than other, potentially less hazardous, dust byproducts of the cement-making process. The Report notes, "Some types of dust from cement production processes may potentially cause runoff waters and effluents to become very basic. . . . In all cases, the dust is a potential health hazard due to fugitive particulate matter. . . ." Id. at P-52-10. It recommends analyzing stormwater runoff from the property "due to the close proximity of the Rio Grande" and cautions that "[t]he potential legal liabilities associated with ownership of [the] property [would] be formidable if groundwater and/or surface water are found to have been impacted." Id. at P-52-13. However, it ultimately concludes that "[t]he risk of stormwater runoff contamination and/or groundwater contamination from the kiln dust deposited on the site cannot be determined at this point." Id.
Stanley Jobe, who commissioned the Report, leased portions of the Plant property from 1994 to 1996 and began preliminary efforts to purchase the property in 1996 and again in 1998. Trial Tr. vol. II, at 16. While Jobe had difficulty recalling the conditions of the Plant at the time of JCPI's leasehold, he did testify that "cement dust or some kind of dust" was present on parts of the property and recalled that "there could have been two feet" of dust accumulated in some places. Id. at 18, 89-90. Additionally, the evidence provided to the Court indicates that Jobe did not purchase the Plant property partly because of the potential environmental liability at the site: he testified that his decision rested in part on environmental concerns and in part on the then-owner's failure to perform demolitions as promised. Id. at 83, 88; see Pl.'s Ex. 56 ("[T]here is tremendous liability in the property."). He also testified that he knew some environmental conditions at the Plant were "terrible" and that he was aware of "extensive contamination" on the property. Trial Tr. vol. II, at 49-51.
The parties' experts agree that CKD contains arsenic. See Trial Tr. vol. IV, at 58; Trial Tr. vol. V, at 67.
Ketterer, Asarco's air-emissions expert, agreed that dust, as a general matter, cannot be visually identified as CKD; however, Ketterer maintained that some of the material on the Plant property was CKD, likely deposited on the property by emissions from the Plant. Trial Tr. vol. IV, at 48, 86. He noted that some of the Report's test results suggested that Raba-Kistner had tested the kiln dust and that these results indicate that the dust was in fact CKD: for example, a sample collected from one of the baghouse precipitators—a control device designed to capture CKD—exhibited chemical properties consistent with CKD, including elevated pH, concentrations of chloride and sulfate, and elevated concentrations of lead and cadmium. Id. at 64-67; id. at 180 (Ames agrees with Ketterer's analysis on this point); see Pl.'s Ex. 52, at P-52-18-P-52-19. Despite Richard's testimony that this sample's profile is not "entirely consistent" with CKD, Trial Tr. vol. V, at 95, the Court credits Ketterer's testimony on this point.
The parties further disagree about the possible concentrations of arsenic found in the CKD at the Plant. Both of Asarco's experts, Ketterer and Ames, relied on the average arsenic content of CKD identified in a 1993 EPA report to Congress: 24 mg/kg.
Whether or not arsenic, in whatever amount, traveled from the Plant to the USIBWC Site is another point of contention between the parties. While Richards testified to the likely use of mechanisms to contain CKD in the actual cement-production process, see Trial Tr. vol. V, at 21-31, neither Jobe nor Dennis knew of any controls to prevent runoff or fugitive emissions from CKD once deposited on the
It is generally not disputed that surface water on the Plant property drains toward the west and southwest, that is, toward the Rio Grande. Trial Tr. vol. II, at 22-23 (testimony of Jobe); see Defs.' Ex. 47, fig.3 (map of area arroyos and groundwater flow).
Any CKD that was transported to the Rio Grande by runoff would flow down the river toward the American Dam and Canal. Trial Tr. vol. IV, at 156-57. When the Dam's gates are closed, water builds up in a settling basin just upstream of the Dam. Trial Tr. vol. I, 185-86; Defs.' Ex. 20, App. K.2, at 20-21. The settling basin and Dam slow the velocity of the river considerably, resulting in the deposition of sediment in the basin. Defs.' Ex. 20, App. K.2, at 20. After reaching a certain volume, water begins to flow over a skimming weir, located at a ninety-degree angle to the Dam, and enters the Canal through its headgate structure.
According to Ames, some water carrying CKD sediment from the Plant would flow into the Canal, while much of the sediment would be deposited just upstream of the Dam. Halted just before the Dam, this sediment would then leach arsenic into the surface water of the river and Canal as well as the surrounding groundwater. Trial Tr. vol. IV, at 156-59. Both Ketterer and Ames discussed the propensity of arsenic in CKD to solubilize rapidly when in contact with water. See id. at 114, 174. In fact, Ketterer testified that it "is a scientific certainty" that CKD combined with water creates an alkaline solution that contains high concentrations of dissolved arsenic. Id. at 114. If arsenic were to leach from CKD sediment into the Rio Grande, upstream of the American Dam, the solution created would infiltrate both the surface water and the groundwater at the USIBWC Site, since the two systems are "in constant communication" with one another. Id. at 163-64; Pl.'s Ex. 158, at P-158-9; cf. Defs.' Ex. 47, at 7 (expert report of Hemingway, in which he states that groundwater "interact[s] with the river" in a variety of ways). Ames testified that the likelihood that arsenic from the Plant ended up in groundwater at the USIBWC Site is thus "Very likely" and "very plausible." Trial Tr. vol. IV, at 192.
Ketterer also testified to the likelihood that fugitive emissions from the Plant could travel to the USIBWC Site and contaminate the soil there, stating that the data "allow the possibility that there is a CEMEX contribution to the air emissions observed in the soil." Id. at 99. Citing other CKD-contaminated sites around the country, Ketterer concluded that it would not be scientifically reasonable to say that the Plant did not contribute arsenic, via air emissions, to the USIBWC Site. Id. at 112. On the other hand, Bowers, CEMEX's soil-contamination expert, testified that the Plant "could not" be the source of soil contamination at the USIBWC Site. Trial Tr. vol. V, at 125. Rather, she testified that no trace of stack emissions from the Plant could be identified in the soil at the USIBWC Site. Id. at 108-09. In addition, she considers the levels of arsenic in CKD to be within the range of natural background,
Both Asarco experts admit that Asarco is a source of arsenic at the USIBWC Site. See Trial Tr. vol. IV, at 202-03, 210, 220 (testimony of Ames that Asarco had some arsenic impact on the groundwater at the USIBWC Site); Pl.'s Ex. 118, at P-118-3 (expert report of Ketterer in which he states that "the former Asarco smelter is a
Ketterer authored a report in 2006 for the Sierra Club in which he concluded that Asarco was the "dominant" source of hazardous substances, including arsenic and lead, in area soils. Id. at 10. Phrased differently, Ketterer concluded that Asarco was responsible for at least 50% of the arsenic in the soil. Id. at 97. Bowers, CEMEX's soil-contamination expert, relied on data from the Sierra Club study to conclude that Asarco's operations are responsible for all of the soil contamination at the USIBWC Site. This conclusion, she argues, is supported by two facts: first, that the concentrations of arsenic in the soil at the Site are much higher than any arsenic concentrations found at the Quarry or the Plant; and second, that the metal ratios in soil samples from the Site exhibit only two "fingerprints," one attributable to slag emissions from Asarco,
In rebuttal, both Ames and Ketterer testified to the presence of arsenic emissions from the Plant in the soil at the USIBWC Site. Analysis of the Sierra Club data conducted by Ames led him to conclude that, while Asarco accounts for the majority of metals contamination at the Site, more than one anthropogenic source of arsenic is needed to account for the data. See Pl.'s Ex. 157, at P-157-9, P-157-11 (explaining that one factor, likely from Asarco, can account for 78.8% of the elevated concentrations of metals, including arsenic, but that the second and third largest factors, which account for 16.4% and 2.8% of the elevated concentrations, respectively, "strongly suggest" one or more additional sources of arsenic in the soil). Ketterer, who conducted the original Sierra Club study, testified that the data does not exclude the possibility that CEMEX also contributed arsenic to the soil at the USIBWC Site. Trial Tr. vol. IV, at 99. Rather, he opined, "it's a certainty that the [C]ement [P]lant is a source of arsenic released into the environment" via both stack emissions and windblown CKD emissions. Id. at 59.
Richards, CEMEX's air-emissions expert, used generic industry statistics and limited data from the Plant and Smelter to estimate the two sources' relative air emissions. Trial Tr. vol. V, at 35-36, 49-50. He concluded that Asarco's emissions were at least 5000 times those of CEMEX. Id. at 38. Asarco's experts noted, however, that the height of the Asarco stacks led to the distribution of Asarco's emissions over an extremely wide area, spreading to Juarez, Chihuahua, Mexico and Anapra, New Mexico. Trial Tr. vol. IV, at 97, 235. They argue that the short height of the Plant stacks, on the other hand, means
Ames, Asarco's water expert, testified that all of the groundwater contamination upstream of the American Dam was caused by CEMEX. As evidence, Ames discussed testing conducted by Malcolm Pirnie, Inc. ("Malcolm Pirnie") at well EP-80, located immediately upgradient of the Dam. Id. at 164-65. Tests done at the well in 2009 found an arsenic value of 0.025 mg/L, two and a half times the EPA standard for arsenic in drinking water, which is 0.01 mg/L. Id. at 169-70. Ames testified that it would not be realistic to conclude that any source other than runoff from the Plant would cause such a high concentration of arsenic to be observed at the well. Id. at 170.
On the other hand, CEMEX's groundwater expert, Hemingway, testified that this concentration of arsenic is consistent with the well's location at the edge of Asarco's groundwater arsenic plume. Trial Tr. vol. V, at 193; Defs.' Ex. 47, fig. 4. Referencing a groundwater map created by Malcolm Pirnie in 2006, Hemingway explained that concentrations of arsenic steadily decline as you get closer to the Rio Grande and farther away from the areas of highest arsenic concentration on the former Asarco property. Trial Tr. vol. V, at 186-87. If there were another source of arsenic in the groundwater, he testified, "then groundwater impact would extend beyond the areas of Asarco's activities, and exhibit a pattern of increase in the direction of the additional source. Defs.' Ex. 47, at 15. Because no such increase occurs, it is not reasonable to suggest that any source other than Asarco contributed arsenic to the groundwater at the Site. Trial Tr. vol. V, at 186-87, 197. Finally, Hemingway testified that arsenic leaching from slag buried at the Parker Brothers arroyo, part of the former Asarco facility, contributed arsenic to the groundwater located upstream of the Dam. Id. at 180-82.
Both Asarco experts emphasize the difference in the leachability of slag and the leachability of CKD. For example, Ames testified that the potential for arsenic to leach into the environment from the materials is like "night and day": while slag's impact is negligible, the potential for arsenic to leach "at a rapid rate" from a powder—particularly into an alkaline solution—is "very high." Trial Tr. vol. IV, at 174; see also id. at 114-17 (testimony of Ketterer explaining the impact of pH on the solubility of arsenic). As a result, Ames testified, slag from the Parker Brothers arroyo did not contribute arsenic to the groundwater even though groundwater from the arroyo travels north of the Dam. Id. at 173-74.
Data obtained from the "Final Remedial Action Work Plan" conducted for the former Asarco smelter by Malcolm Pirnie in 2011, undermines both parties' groundwater-related assertions. Rather, the Malcolm Pirnie report makes clear that, no matter the rate at which arsenic leaches from slag, slag on the former Asarco property has contributed significant amounts of arsenic to the groundwater at the property and at the USIBWC Site. See Defs.' Ex. 51, at ES-3 (describing groundwater at Parker Brothers arroyo); id. § 2-5 ("Elevated concentrations of arsenic, which is the primary groundwater [contaminant of concern], occur over a large area which extends from the former facility to the Rio Grande floodplain. . . ."). However, the report also makes clear that the majority of Asarco's contribution to arsenic in groundwater—from slag and other sources, such as the former acid plant—affects the USIBWC Site downgradient of
CERCLA was enacted in 1980 as a broad, remedial response to environmental harm. See Amoco Oil Co. v. Borden, Inc., 889 F.2d 664, 667 (5th Cir.1989). The statute encourages timely response to environmental hazards and shifts the costs of that response from taxpayers to the companies and industries responsible for the hazard. See Control Data Corp. v. S.C.S.C. Corp., 53 F.3d 930, 935-36 (8th Cir.1995). As such, courts agree that CERCLA should be construed liberally to effectively implement its goals. United States v. Alcan Aluminum Corp. (Alcan I), 964 F.2d 252, 258 (3d Cir.1992) (citing B.F. Goodrich v. Murtha, 958 F.2d 1192, 1197 (2d Cir.1992); Dedham Water Co. v. Cumberland Farms Dairy, Inc., 889 F.2d 1146, 1150 (1st Cir.1989)).
Unfortunately, courts also agree that CERCLA, a hastily enacted legislative compromise, is poorly drafted, ambiguous, and difficult to interpret. Amoco Oil, 889 F.2d at 667 ("[B]ecause [CERCLA] was enacted as a `last-minute compromise' between three competing bills, it has `acquired a well-deserved notoriety for vaguely drafted provisions and an indefinite, if not contradictory, legislative history.'" (quoting United States v. Mottolo, 605 F.Supp. 898, 902, 905 (D.N.H.1985))).
42 U.S.C. § 9607(a) (2006).
Asarco brings this claim against CEMEX pursuant to § 113(f) of CERCLA,
What these elements require is, for the most part, uncontroversial. CERCLA defines a "release" as "any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment." 42 U.S.C. § 9601(22). The release must be of a "hazardous substance," defined by CERCLA in reference to a number of other statutes and regulations. Id. § 9601(14). The release must also come "from a facility," which CERCLA defines as
Id. § 9601(9). A defendant must be a responsible person with respect to that facility, that is, a defendant must fall into one of the § 107(a) categories—current owners or operators, former owners or operators, arrangers, or transporters—with respect to the site of the release. See id. § 9607(a). In addition, the Government must have incurred removal and remedial costs that are not inconsistent with the NCP—a set of "procedures and standards for responding to releases of hazardous substances" that is promulgated by the EPA. Amoco Oil, 889 F.2d at 672 (quoting 42 U.S.C. § 9605(a)); see 40 C.F.R. § 300.700 (2013). Finally, the incurrence of these costs must have been "caused" by the release from the facility for which defendant is a responsible person. 42 U.S.C. § 9607(a).
What "caused" means in this context is unclear and vigorously contested by the
In a one-site case, the site of the release or threatened release of a hazardous substance and the site where the Government has incurred cleanup costs are one and the same. In those cases, a plaintiff must prove (1) that the site in question is a "facility" pursuant to § 101(9); (2) that the defendant is a responsible person pursuant to § 107(a); (3) that a release or a threatened release of a hazardous substance has occurred; and (4) that the release or threatened release caused the Government to incur costs. Amoco Oil, 889 F.2d at 668. A plaintiff need not demonstrate that a particular defendant caused the Government to incur those costs, or even that the defendant caused the release that, in turn, caused the Government to incur costs. Amoco Oil, 889 F.2d at 670 n. 8 ("[I]n cases involving multiple sources of contamination, a plaintiff need not prove a specific causal link between costs incurred and an individual generator's waste."). Rather, a plaintiff must only prove that a release from a site for which the defendant is a responsible person caused the Government to incur costs. Outlet City, Inc. v. W. Chem. Prods., 60 Fed.Appx. 922, 926 (3d Cir.2003) (citing Alcan I, 964 F.2d at 264-66) ("[T]he only causation required under CERCLA is that the release of hazardous substances at the `facility' cause the response costs; a plaintiff does not need to prove that the defendant's waste caused the response costs under Section 107.").
In a two-site case, the release or threatened release of a hazardous substance occurs at one site, and the Government incurs response costs at another. CEMEX relies heavily on court decisions that express concern that the application of strict liability in two-site cases would result in unfair or absurd results. For example, the U.S. District Court for the Western District of Missouri has held that, "where ... response costs are incurred solely as a result of and in response to ... actual contamination, the plaintiff must prove that the release by the defendant actually caused the contamination" for which response costs were incurred. Thomas v. FAG Bearings Corp., 846 F.Supp. 1382, 1390 (W.D.Mo.1994) (emphasis added). If the plaintiff was not required to make such a showing, the court
After a review of the statute, its legislative history, and applicable case law, the Court holds that the analytical framework that applies in a two-site CERCLA case is no different than the framework that applies in a one-site CERCLA case. Importantly, this holding does not result in the doomsday scenario feared by CEMEX and the Thomas court. Rather, Section 107(a) always requires a plaintiff to prove, in its prima facie case, that a release from a facility for which the defendant is a responsible person caused the incurrence of response costs.
It remains unclear what evidence a plaintiff must provide to successfully establish that a release caused the incurrence of response costs. While the Fifth Circuit has addressed this question, it did so in a different context: to determine whether a release justified the incurred response costs. See Amoco Oil, 889 F.2d at 670.
Some courts, including the Fourth Circuit, apply a burden-shifting approach favored by Asarco. Under this approach, a plaintiff "meets its burden on summary judgment if it (a) identifies a contaminant at [the cleanup site], (b) identifies the same (or perhaps a chemically similar) contaminant at the defendant's site, and (c) provides evidence of a plausible migration pathway by which the contaminant could have traveled from the defendant's facility to the [cleanup] site." Castaic Lake Water Agency v. Whittaker Corp., 272 F.Supp.2d 1053, 1067 (C.D.Cal.2003) (citing Westfarm Assocs. Ltd. v. Wash. Suburban Sanitary Comm'n, 66 F.3d 669, 681-82 (4th Cir. 1995); Alcan I, 964 F.2d at 264-66; Artesian Water, 659 F.Supp. at 1281-82; United States v. Bliss, 667 F.Supp. 1298, 1311 (E.D.Mo.1987)). Significantly, this approach places the burden of proof on the defendant to disprove causation: "The plaintiff need not produce any evidence that the contaminants did flow onto [the cleanup site] from the defendant's land. Rather, once plaintiff has proven a prima facie case, the burden of proof falls on the defendant to disprove causation." Westfarm, 66 F.3d at 681; accord United States v. Monsanto Co., 858 F.2d 160, 170 (4th Cir.1988) ("Congress has ... allocated the burden of disproving causation to the defendant who profited from the generation and inexpensive disposal of hazardous waste.").
The test favored by CEMEX, on the other hand, places the burden on the plaintiff to show that a defendant actually contributed to the contamination that caused the plaintiff to incur response costs. For example, in KRSG I, the Sixth Circuit affirmed the district court's opinion that "[t]he existence of a possibility [of migration] does not create a material issue of fact for trial because [the plaintiff] bears the burden of proof to show that [the defendant] did contribute to PCBs in the Kalamazoo River, not that it is possible that it might have contributed to the PCBs." Kalamazoo River Study Grp. v.
As discussed above, CERCLA is a broad, remedial statute meant to shift the costs of environmental hazards to the companies and industries responsible for them. Other courts have engaged in extensive discussion and interpretation of § 107, concluding that the text, structure, and legislative history of § 107 strongly suggest that a direct connection between a defendant and the incurrence of response costs is unnecessary. E.g., Kalamazoo River Study Grp. v. Menasha Corp., 228 F.3d 648, 655-56 (6th Cir.2000) (citing United States v. Twp. of Brighton, 153 F.3d 307, 328-29 (6th Cir.1998); Alcan I, 964 F.2d at 266; Shore Realty, 759 F.2d at 1044; United States v. Alcan Aluminum Corp. (Alcan II), 990 F.2d 711, 721 (2d Cir.1993); Amoco Oil, 889 F.2d at 670 n. 8; Monsanto, 858 F.2d at 169). While such a conclusion may belie the "notions of fairness" on which common-law tort doctrines of causation are founded, Congress made this policy choice when it enacted CERCLA into law. See Bliss, 667 F.Supp. at 1309 ("[The] structure of CERCLA and its legislative history make clear that traditional tort notions, such as proximate cause, do not apply."). As explained by the Second Circuit, "[t]here may be unfairness in the
The Court concludes that CERCLA's goals are better served by the framework laid out by the Fourth Circuit in Westfarm. To find CEMEX liable pursuant to CERCLA, Asarco must initially demonstrate that the same or a similar contaminant is present both at the USIBWC Site and at the CEMEX Site. Asarco must also demonstrate the existence of a "plausible migration pathway" from the CEMEX Site to the USIBWC Site. Asarco need not, however, show actual contamination at the USIBWC Site by CEMEX, and certainly need not "fingerprint" the waste as CEMEX's. Rather, the burden falls on CEMEX to demonstrate that it was not the source of any contamination at the USIBWC Site.
The Court notes that a "possible" migration pathway, as discussed in KRSG I, is not a "plausible" migration pathway. The Sixth Circuit noted in KRSG I that the testifying expert's assumption "that water flowed down the ditch to [the cleanup site]. ... [was] based solely on speculation and possibility." A speculative migration pathway is not a plausible one. Rather, the Court must conduct an inquiry into the facts as a whole—considering factors such as the location of the cleanup site and defendant's facility, the geology and hydrology of the area, and the nature and quantity of the contamination—to determine whether it is more likely than not that the release from defendant's facility could have migrated to the cleanup site. Cf. Thomas, 846 F.Supp. at 1390 (listing possible factors to weigh when determining causation).
Difficult proof problems are inherent in hazardous-waste cases: "the co-mingling and migration of wastes at a disposal site make[] identification of sources scientifically difficult and economically infeasible." Bliss, 667 F.Supp. at 1309-10 (citing United States v. Wade, 577 F.Supp. 1326, 1332-33 (E.D.Penn.1983); United States v. S.C. Recycling & Disposal, Inc., 653 F.Supp. 984, 993 n. 6 (D.S.C.1986)). To impose a "fingerprinting" requirement on a plaintiff "might permit the owners and operators of ... facilities to avoid financial responsibility for the cleanup, and would thus eviscerate section 107." Artesian Water, 659 F.Supp. at 1282 (citing Wade, 577 F.Supp. at 1332-33). As a result, and in order to effect CERCLA's intent, the Court concludes that a CERCLA plaintiff need not prove actual contamination by a defendant in order to successfully establish that defendant's liability pursuant to § 107.
In accordance with the Court's holding, Asarco must demonstrate that arsenic, found both at the Quarry and at the USIBWC Site, could have plausibly migrated from the Quarry to the USIBWC Site. Asarco has failed to carry this burden.
Evidence presented by Asarco demonstrates only that fugitive emissions and surface-water runoff from the Quarry could travel offsite. E.g., Trial Tr. vol. III, at 82-83 (testimony of Dennis that quarrying and transporting limestone can create dust containing arsenic); id. at 86, 103-104 (testimony of Dennis that it would be possible for materials to be taken offsite via surface water). Neither of Asarco's expert witnesses rendered any opinions about the Quarry, nor did Asarco present any evidence that would show possible migration pathways of fugitive emissions or groundwater
Asarco did, on the other hand, present extensive evidence about contamination at the Plant and its potential migration to the USIBWC Site. As a result, the Court will address each element of Asarco's prima facie case in turn.
As discussed above, CEMEX, Inc. is a successor in interest to SWPCC, which built and operated the Plant from 1910 to 1985. Parties' Stip. Facts ¶¶ 6, 8, 10. While CEMEX, Inc. itself has never owned or operated the Plant, this fact is not relevant for purposes of CERCLA liability. HRW Sys., Inc. v. Wash. Gas Light Co., 823 F.Supp. 318, 329 (D.Md.1993). Rather, the question before the Court is whether the accrued CERCLA liability of SWPCC has been passed on to CEMEX, Inc. See id.
Courts have unanimously held that successor liability applies in CERCLA contribution claims. See Cooke, supra, § 14.01[4][c][iii][B] (collecting cases). "`In case of merger of one corporation into another, where one of the corporations ceases to exist and the other corporation continues in existence, the latter corporation is liable for the debts, contracts and torts of the former, at least to the extent of the property and assets received....'" Smith Land & Imp. Corp. v. Celotex Corp., 851 F.2d 86, 91 (3d Cir.1988) (quoting 15 W. Fletcher, Cyclopedia of the Law of Private Corporations § 7121, at 185 (rev. perm. ed.1983)). The record in this case indicates that SWPCC "merged into" Southdown, Inc, which later "changed its name" to CEMEX, Inc.
CERCLA § 107(a)(2) extends liability to former owners or operators of a facility, designating as a responsible person "any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of." 42 U.S.C. § 9607(a)(2). The Court finds overwhelming evidence that materials containing arsenic—a hazardous substance pursuant to
Because arsenic is present on the Plant property, the Plant is a facility as defined by CERCLA. See 42 U.S.C. § 9601(9) (defining "facility" as "any site or area where a hazardous substance has ... come to be located"). Further, because the arsenic-containing CKD originated in the cement-making process—a process that occurred from 1910 to 1985, while SWPCC owned and operated the Plant—SWPCC was the owner and operator of the Plant at the time of arsenic's disposal there.
As a general matter, the Court credits the testimony of Asarco's experts, Ketterer and Ames, regarding the likelihood that arsenic from the CKD released from the Plant then migrated to the USIBWC Site, infiltrating the soil, surface water, and groundwater there. Ames testified that it was "very likely" and "very plausible" that arsenic from the Plant, traveling via surface-water runoff, would migrate to the USIBWC Site. Trial Tr. vol. IV, at 192. Both parties' water experts agreed that surface-water runoff from the Plant property would flow down the property toward the southwest, into a concrete-lined culvert under Paisano Drive, and then into the Rio Grande upstream of the American Dam. Id. at 152-54; Trial Tr. vol. V, at 167-68. That water would continue down the river to the USIBWC Site, where it would interact with the Site's groundwater. Trial Tr. vol. IV, at 156-57, 163-64; Defs.' Ex. 47, at 7. Additionally, both Ketterer and Ames emphasized that arsenic would leach from CKD "at a rapid rate" once the CKD made contact with water. Trial Tr. vol. IV, at 174; id. at 114-17. This testimony, in combination with the presence of CKD on the Plant property and CEMEX's lack of information about any controls put in place to control surface-water runoff, suffices to establish a plausible migration pathway for arsenic between the Plant and the USIBWC Site.
The Court also concludes that Asarco has established a plausible migration pathway for fugitive emissions from the Plant to land on the soil of the USIBWC Site. The two locations are close in proximity, and Ketterer—an air-emissions expert on whose data both parties' experts relied—testified that it would not be scientifically reasonable to say that the Plant did not contribute to the contamination at the USIBWC Site via air emissions. Id. at 112. This conclusion is further supported by the height of the Plant's stacks and the warnings about fugitive emissions contained in the 1989 Raba-Kistner Report. See id. at 48; Pl.'s Ex. 52, at P-52-9-P-52-10. While the testimony of Bowers calls into question the impact of arsenic from the Plant on the soil at the USIBWC
The settlement agreement between Asarco and the Government in this case resolves any and all liability on the part of Asarco for the "[r]esponse costs [that] have been and will be incurred by EPA at [the USIBWC Site] not inconsistent with the National Contingency Plan."
Courts must conduct a two-part inquiry when analyzing the merits of § 113(f) contribution claims: "First, the court must determine whether the defendant is `liable' under CERCLA § 107(a)," as the Court has done above. "Second, the court must allocate response costs among liable parties in an equitable manner," which the Court will now do. United States v. Kramer, 644 F.Supp.2d 479, 488-89 (D.N.J.2008) (quoting Goodrich Corp. v. Town of Middlebury, 311 F.3d 154, 168 (2d Cir.2002)).
In a rare moment of accord, the parties agree on the appropriate framework for determining the allocation of response costs in this case. Section 113(f) instructs courts to "allocate response costs among liable parties using such equitable factors as the court determines are appropriate." 42 U.S.C. § 9613(f) (2006). While courts may consider any factors they deem relevant, they often use the so-called Gore Factors to guide their allocation analysis. See Bell Petroleum Servs., 3 F.3d at 900-01 & n. 12. The Gore Factors include the following:
Amoco Oil, 889 F.2d at 672-73 (quoting H.R.Rep. No. 99-253, pt. III, at 19, reprinted in Superfund Amendments and Reauthorization Act of 1986, Pub.L. No. 99-499, 1986 U.S.C.C.A.N. 3038, 3042). CERCLA-contribution plaintiffs must demonstrate that they are entitled to reimbursement by a preponderance of the evidence. Kalamazoo River Study Grp. v. Rockwell Int'l Corp., 355 F.3d 574, 589-90 (6th Cir.2004) (citing B.F. Goodrich v. Betkoski, 99 F.3d 505, 526 (2d Cir.1996)).
Notably, while causation between a specific defendant's waste and the incurred response costs is not appropriate for consideration during the liability phase of a court's analysis, whether a defendant caused the incurrence of response costs is an appropriate equitable factor in deciding how to allocate responsibility of those costs. See John M. Hyson, "Causation" in CERCLA Private Cost Recovery Actions, in Hazardous Substances, Site Remediation, and Enforcement 59, 65 (Am. Law Inst.2003). For example, the Sixth Circuit has held that "[a] holding of potential liability does not preclude a zero allocation of response costs" in cases where the plaintiff fails to adequately demonstrate that a defendant caused the incurrence of those costs. Kalamazoo River Study Grp. v. Rockwell Int'l Corp., 274 F.3d 1043, 1047 (2001); see also PMC, Inc. v. Sherwin-Williams Co., 151 F.3d 610, 616 (7th Cir. 1998) ("[The defendant's] spills may have been too inconsequential to affect the cost of cleaning up significantly, and in that event a zero allocation to [the defendant] would be appropriate."). Thus, the Court will consider CEMEX's argument that it did not contribute any actual contamination to the USIBWC Site when determining how to allocate responsibility between the parties.
The Court begins its allocation analysis by noting that a number of the Gore factors do not help distinguish the parties in this case. Rather, uncontroverted evidence demonstrates that both Asarco and CEMEX conducted industrial operations that involved the generation of hazardous wastes, including arsenic, and that neither party exercised the necessary degree of care in handling those wastes. The record before the Court also indicates that each party has complied with officials only when facing suit or other legal action, conduct that fails to rise to the level of "cooperation." The Court will instead focus its attention on the relative contributions of each party to the contamination at the USIBWC Site, to the extent that such contributions can be distinguished.
Contrary to its assertions, Asarco clearly contributed substantial amounts of arsenic to the soil and groundwater at the USIBWC Site. Both of Asarco's expert witnesses testified to this fact. Trial Tr. vol. IV at 10 (testimony of Ketterer that Asarco is dominant source of hazardous substances, including arsenic, in area soils); id. at 93-94 (testimony of Ketterer that arsenic on the CEMEX Site could have come from Asarco); id. at 202-03, 210, 220 (testimony of Ames that Asarco contributed arsenic to groundwater at the USIBWC Site downgradient of the Dam). In addition, none of the remedial investigations commissioned by the USIBWC identified any source of contamination at the USIBWC Site other than Asarco. Trial Tr. vol. I, at 189; see id. (testimony of Anaya explaining that the purpose of remedial investigations is to identify all sources of contamination). Finally, the Malcolm Pirnie Report confirms that slag
Evidence as to the extent of actual contamination attributable to CEMEX, Inc. is far less clear. While both of Asarco's expert witnesses stated that the Plant is a certain source of the arsenic at the USIBWC Site, Trial Tr. vol. IV, at 59, 112, 169-71, 192, neither rendered an opinion as to allocation or quantified what CEMEX, Inc.'s contribution might be, see id. at 88, 222.
At trial, CEMEX emphasized the possibility that very little, if any, of the dust at the Plant was indeed CKD, Trial Tr. vol. V, at 14, and that much of the dust was inside buildings or crusted over, making it unlikely to be carried off the property by water or wind, Trial Tr. vol. IV, at 188-89, 222. On the other hand, Asarco provided credible evidence that at least some of the dust on the Plant property was CKD and susceptible to migrating, via surface water or fugitive emissions, to the USIBWC Site. Id. at 64-67 (testimony of Ketterer that a soil sample from the Plant exhibits chemical properties consistent with CKD); see supra Part I.B. 1.b. Further, Asarco provided evidence that CEMEX failed to manage and properly dispose of the CKD generated at the Plant, see Trial Tr. vol. II, at 115 (testimony of Jobe); Trial Tr. vol. III, at 79-81 (testimony of Dennis), and that CEMEX never installed any controls to contain runoff from the Plant property, Trial Tr. vol. II, at 30 (testimony of Jobe); Trial Tr. vol. III, at 85-87 (testimony of Dennis). As a result, the Court concludes that Asarco has demonstrated by a preponderance of the evidence that CEMEX contributed at least some arsenic to the contamination at the USIBWC Site.
Bowers testified that CEMEX contributed no arsenic to the soil at the USIBWC Site because no additional fingerprint—beyond the two left by emissions and slag from Asarco—was identifiable there. Trial Tr. vol. V, at 112. In addition, she testified that any air emissions from the Plant would not have contributed to contamination at the USIBWC Site because the arsenic in CKD is within the background level at the Site. Id. at 108, 140-41. The Court notes that her analysis relies, in part, on a faulty understanding of the actual background level of arsenic in area soil: soil at the Plant property exhibited a maximum arsenic concentration of 36.2 mg/kg in 2012, well above the background level of approximately 10 mg/kg, see supra n. 4, and similarly above the Texas Commission of Environmental Quality's action level of 24 mg/kg, Trial Tr. vol. V, at 102. In addition, analysis conducted by Ames casts doubt on Bowers's conclusions: while Ames agrees that at least two sources of arsenic are present at the USIBWC Site, he disagrees that both sources are attributable to Asarco. Rather, Ames concluded via Principal Component Analysis that the data represents the impacts from air emissions from multiple sources, not simply two different types of contamination from Asarco. Pl.'s Ex. 157, at P-157-9, App. A. Similarly, while Ketterer also agrees that two different types of contamination can be found in the soil, he testified that "the data allow the possibility that there is a CEMEX contribution to the air emissions observed in the soil." Trial Tr. vol. IV, at 18, 20, 99. The Court finds the analysis and opinions rendered by the Asarco experts more convincing; thus, the Court concludes that Asarco has proven by a preponderance of the evidence that arsenic from Plant operations had an impact on the soil at the USIBWC Site.
Hemingway testified that Asarco is the "exclusive source" of groundwater contamination at the USIBWC Site. Trial Tr. vol. V, at 197; see id. at 186-87 (using Malcolm Pirnie groundwater map to explain that the pattern of impact is not consistent with more than one source of arsenic). This assertion is undermined by the Malcolm Pirnie report, which states that the majority of groundwater from the former Asarco
While the Court therefore finds that Asarco has proven its entitlement to some reimbursement from CEMEX, Inc., the Court has little information on which to base its allocation of costs.
Based on the above findings of fact and conclusions of law, the Court finds that Asarco has established that Defendant CEMEX, Inc. is liable pursuant to § 107(a) and responsible for approximately 5% of the costs incurred by the Government at the USIBWC Site. As a result, the Court determines that Plaintiff ASARCO LLC is entitled to contribution from CEMEX, Inc. in the amount of $1,100,000.00 as well as proper pre- and postjudgment interest. The Court further finds that Asarco has failed to establish that Defendant CEMEX Construction Materials South,
Soil samples taken at the Quarry exhibited maximum arsenic concentrations of 39 mg/kg in 2002 and 22.3 mg/kg in 2012. Defs.' Ex. 45, at 4; Defs.' Ex. 47, at 11-12. Bowers testified that these numbers reflect "natural background levels of arsenic." Trial Tr. vol. V, at 111-12.
The cases cited by CEMEX in its Supplemental Trial Brief are not to the contrary. For example, the Sixth Circuit has held that "in order to make out a prima facie case [in a two-site case], the plaintiff must establish a causal connection between the defendant's release of hazardous substances and the plaintiff's response costs incurred in cleaning them up." Kalamazoo River Study Grp. v. Rockwell Int'l Corp., 171 F.3d 1065, 1068 (6th Cir. 1999) (citing Thomas, 846 F.Supp. at 1387). Other cases discussed by CEMEX quote this standard with approval. Innis Arden Golf Club v. Pitney Bowes, Inc., 629 F.Supp.2d 175, 185-86 (D.Conn.2009); Solutia, Inc. v. McWane, Inc., No. 1:03-cv-1345-PWG, 2012 WL 2031350, at *8 (N.D.Ala. June 1, 2012). The Court does not believe that the relevant release must be defendant's release, as discussed above. However, the Court is in agreement that a causal connection must be established between the release of hazardous substances at the site for which defendant is a responsible person and the response costs incurred in cleaning those hazardous substances up. The Court thus fully agrees with the statement in Innis Arden that "a plaintiff must provide some evidence linking its response costs to the targeted off-site release of contaminants." 629 F.Supp.2d at 186 (citing White v. County of Newberry, 985 F.2d 168, 174-75 (4th Cir. 1993); Dedham Water Co. v. Cumberland Farms Dairy, Inc., 972 F.2d 453, 459-60 & n. 3 (1st Cir.1992); Amoco Oil, 889 F.2d at 670).
