Stoel Rives Environmental Law Alert: Supremes Resurrect CERCLA 107 By J. Mark Morford
6/11/2007

This morning, the Supreme Court issued its opinion in United States v. Atlantic Research Corporation, 551 US ____ (2007) regarding cost recovery actions under section 107 of the Comprehensive Environmental Response Compensation and Liability Act (CERCLA). This case tested the Supreme Court's somewhat controversial and confusing decision in Cooper Industries v. Aviall Services, where the court ruled that a CERCLA section 113 contribution claim can only be brought by a plaintiff who has been sued under CERCLA sections 106 or 107. The Aviall decision appeared to leave out in the cold a party that voluntarily incurred response costs in the absence of a governmental order. In Atlantic Research, the Court has resurrected section 107 by holding that any person, including a PRP, who incurs response costs may pursue cost recovery claims under section 107.

Mostly, this decision reestablishes the status quo from before Aviall, but the combination of the two decisions inevitably raises new issues that the lower courts will have to sort out. The Court repeats its statement from Aviall that that sections 107 and 113 establish "'clearly distinct' remedies." Section 107 authorizes cost recovery claims for plaintiffs who incur response costs. Section 113 authorizes contribution claims for plaintiffs who pay, through judgment or settlement, someone else’s response costs. CERCLA's guidance for equitable allocation is found only in section 113 and its legislative history, raising the question of whether and how costs are to be allocated under section 107. Several statements in the Atlantic Research opinion about joint and several liability under section 107 further highlight this question. The opinion also raises questions about the scope of contribution protection in an EPA settlement. The Court actually addresses this question in dictum stating that such contribution protection will not apply to section 107 claims.

Despite these remaining questions, the Court’s opinion in Atlantic Research, generally serves to stabilize the world of PRP litigation and should reverse the chill Aviall cast on voluntary cleanups and cooperation with environmental agencies.

For more information contact Mark Morford or your favorite Stoel Rives environmental attorney.

This is a publication of Stoel Rives Environmental Group for the benefit and information of clients and friends. This bulletin is not legal advice or a legal opinion on specific facts or circumstances. The contents are intended for information purposes only. Copyright 2007, Stoel Rives LLP.