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NEW JERSEY TURNPIKE AUTH. v. PPG INDUS.

May 15, 1998

NEW JERSEY TURNPIKE AUTHORITY, Plaintiff,
v.
PPG INDUSTRIES, INC.; NATURAL PRODUCTS REFINING COMPANY; F.S.F. COMPANY; ALLIEDSIGNAL, INC.; MUTUAL CHEMICAL COMPANY OF AMERICA; OCCIDENTAL CHEMICAL CORPORATION; MAXUS ENERGY CORPORATION; OCCIDENTAL PETROLEUM CORPORATION; OXY-DIAMOND ALKALI CORPORATION; CHEMICAL LAND HOLDINGS, INC.; MARTIN DENNIS COMPANY; GEORGE M. BREWSTER & SONS, INC.; FELHABER CORPORATION; MOHAWK CONSTRUCTORS, II, INC.; REID CONTRACTING COMPANY, INC.; KLEVENS CORPORATION; HORN CONSTRUCTION COMPANY, INC.; UNITED STATES FIDELITY & GUARANTY COMPANY; AMERICAN MUTUAL LIABILITY INSURANCE COMPANY; JOHN DOE GENERATORS; JOHN DOE OPERATORS; JOHN DOE OWNERS; JOHN DOE TRANSPORTERS; JOHN DOE AFFILIATES; Defendants.



The opinion of the court was delivered by: BISSELL

OPINION

 BISSELL, District Judge

 This matter comes before the Court on three separate motions: (1) Defendant AlliedSignal, Inc.'s ("Allied") motion for summary judgment (in which Defendant PPG Industries, Inc. ("PPG") joins); (2) Defendants Occidental Chemical Corporation's and Maxus Energy Corporation's (collectively, "Occidental") *fn1" motion for summary judgment; and (3) Plaintiff New Jersey Turnpike Authority's ("NJTA") cross-motion for partial summary judgment on the issue of liability against all of the Generator Defendants (Occidental, Allied and PPG). NJTA instituted this action on May 17, 1993 against the three Generator Defendants, asserting claims under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq.; the New Jersey Spill Compensation and Control Act ("Spill Act"), N.J.S.A. 58: 10-23.11 et seq.; and the common law of the State of New Jersey. *fn2" Also included in the complaint was a claim for a declaratory judgment against the major defendants' insurance companies; however, summary judgment was granted in favor of the insurers in early 1996 and the declaratory judgment claim was dismissed from this action with prejudice. Certain other minor defendants were also named in the complaint. To date, none of the minor defendants have appeared in this action, with the exception of a non-generator defendant, Mohawk Constructors, Inc., in whose favor summary judgment was entered, without opposition from NJTA, on January 12, 1998.

 The Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1367.

 STATEMENT OF THE CASE

 The NJTA operates approximately one hundred eighty miles of highway, from the George Washington Bridge in northern New Jersey to the Delaware Memorial Bridge in the southwestern part of the State. In this action, it seeks to recover for the cost of investigating and remediating environmental contamination discovered at seven sites it currently owns or operates. The sites at issue are parcels of real property located primarily in Jersey City and Kearny, New Jersey. They are identified by the following New Jersey Department of Environmental Protection ("NJDEP") site numbers: 7, 20, 21, 56, 131, 192 and 201, and are described in greater detail by NJTA in its discovery responses. (See Field Cert., Exh. A at 5). All seven sites contain parts of the physical structure of the highway -- piers, pilings and footings for elevated portions of the highway, work roads, access roads, etc. -- which were built at different times from the early 1950's to the mid-1970's. (Doolan Cert. P 2).

 Each of the sites has been found to contain chromite ore processing residue ("COPR"), a substance designated as hazardous by the United States Environmental Protection Agency and NJDEP. COPR is a by-product of the refinement of chromium ore into metallic chromium components. (Id. P 3). During the 1980's, the previously well-known toxic effects of chromium and chromium compounds became recognized as hazardous to the environment. Upon learning of the widespread use of COPR as landfill in Essex and Hudson Counties, NJDEP began investigating possible chromium contamination at numerous sites in that region of New Jersey.

 NJTA alleges that at various times during the 1900's, the three Generator Defendants named in the complaint, Occidental, Allied and PPG (or the predecessor companies of these Defendants), owned or operated chemical companies in Hudson County that processed chromium ore. (Compl. PP 47, 68, 96, 97). Defendant PPG allegedly acquired the Natural Products Refining Company, which processed chromium ore at a site in Jersey City from the 1950's until 1964. (Id. PP 54, 57, 68). Defendants Occidental and Maxus are allegedly responsible for the actions of Diamond Shamrock, which processed chromium ore at a facility in Kearny until the 1970's. (Id. PP 96-97). Defendant Allied is allegedly responsible as the successor of Mutual Chemical Corporation of America, which processed chromium ore at a site in Jersey City until the early 1950's. (Id. P 47). The COPR produced at these three facilities was allegedly transported to other locations in New Jersey for use as fill material in various construction projects, including projects associated with the New Jersey Turnpike. (Id. PP 118, 120, 122). According to NJTA, the seven sites at issue in this litigation were among the properties that received COPR from the facilities of the alleged Generators. (Id. PP 119, 121, 123).

 In 1988, NJDEP issued a "Directive" that listed 118 chromium-contaminated sites, including four of the seven sites at issue in this lawsuit -- Sites 7, 20, and 21 in Jersey City (where Allied's and PPG's plants were located) and Site 56 in Kearny (where Diamond Shamrock's plant was located). (See Starnes Cert., Exh. B). The 1988 Directive assigned the responsibility for the investigation and remediation of these four NJTA sites collectively to Allied, PPG and Occidental. (Id., Attachment One). It acknowledged, however, that it "cannot identify which of the Respondent's chromite chemical production waste has been discharged and/or is being discharged" at those sites. (Id. P 17).

 In April 1990, Occidental entered into an Administrative Consent Order ("ACO") with NJDEP, voluntarily agreeing to investigate and remediate 26 chromium-contaminated sites in Kearny, including NJTA Sites 56 and 131. (Field Cert., Exh. E). Occidental agreed in the 1990 ACO to make monetary payments under the Spill Act, reimburse certain costs to NJDEP, and propose and implement interim and long-term remedial measures with respect to the Kearny sites. Occidental's execution of the 1990 ACO did not constitute an admission of any liability or fault, the agreement specifically stating that: "although it agrees to pay this civil penalty, [Occidental] denies any violation of statute, rule, regulation or ordinance and payment of this penalty is without admission of fact, fault, liability or obligation." (Id. P 22). As well, the ACO states: "Neither the entry into this [ACO] nor the conduct of the Respondents hereunder, shall be construed as any admission of fact, fault or liability by the Respondents under any applicable laws or regulations." (Id. P 109).

 Since the entry of the 1990 ACO, Occidental has continued to assume responsibility for investigating and remediating chromium-contaminated sites in Kearny, including NJTA Sites 56 and 131. In addition, in March 1997, Occidental agreed with NJDEP to assume responsibility for a recently-designated NJTA site in Kearny - Site 201, "notwithstanding that the Department has been unable to identify the source of the COPR" located at that site and, again, without Occidental's admitting any legal liability for the contamination at that site. (Starnes Cert., Exh. C at 2). To date, Occidental has spent more than $ 700,000 implementing investigatory and remedial activities at the NJTA sites in Kearny alone and over $ 47 million at the many non-NJTA sites in Kearny that are also covered by the 1990 ACO. *fn3" (Id. at 18).

 Three of the other four NJTA sites in question -- Sites 7, 20, 21-- are located in Jersey City, where Allied and PPG conducted their chromite ore processing operations, and Site 192 is located in Newark. Recall that the 1988 Directive assigned responsibility for the investigation and remediation of three of these four sites -- Sites 7, 20, and 21 -- collectively to Occidental, Allied and PPG. None of the Generator Defendants, however, has assumed responsibility for the COPR deposited on those sites. Later, in May 1994, NJDEP issued a Directive assigning responsibility for Site 7 to Allied (Starnes Cert., Exh. G), but Allied and NJDEP have apparently been unable to agree upon a plan to remediate that site. Similarly, no one has agreed to investigate or remediate the COPR found at Sites 20, 21 or 192. (Field Cert., Exh. D at P 8).

 Occidental, Allied and PPG all agree on the central point of the motion filed by Allied and joined in by PPG -- that NJTA cannot recover from any pf the Generator Defendants in this action unless it establishes, at a minimum, that COPR generated by that specific defendant was deposited at one or more of the seven NJTA sites at issue in this litigation. This argument underlies the three Defendants' motions for summary judgment on all of NJTA's claims -- its CERCLA and Spill Act claims as well as its state law claims. The motion submitted by Allied and PPG, however, distinguishes between the three Kearny sites and the other four sites insofar as Occidental is concerned, indicating that a slightly different analysis may be required regarding Occidental's liability for the Kearny sites. Occidental submits a separate memorandum of law to address this point and to emphasize that, in its view, the central principal underlying Allied's motion requires that summary judgment be entered against NJTA on all of the claims against Occidental as well, including those related to the three sites in Kearny that Occidental has agreed to investigate and remediate pursuant to the 1990 ACO with NJDEP. (See Field Cert., Exh. E). Allied and PPG argue in response to this that, although they do not seek to deflect any attention for the responsibility of these sites to Occidental (and agree that summary judgment should be awarded in favor of all of the Defendants on all seven sites), Occidental is not entitled to any contribution from either of them for the money it has spent investigating and remediating the Kearny sites.

 ANALYSIS

 I. SUMMARY JUDGMENT STANDARD

 As previously stated, all three motions presently before the Court seek awards of summary judgment. Federal Rule of Civil Procedure 56(c) provides that summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). In applying that standard:

 
the judge must ask . . . not whether . . . the evidence unmistakably favors one side or the other but whether a fair-minded jury could return a verdict for the [nonmoving party] on the evidence presented. The mere existence of a scintilla of evidence in support of the [non-movant's] position will be insufficient; there must be evidence on which the jury could reasonably find for the [nonmoving party]. The judge's inquiry, therefore, unavoidably asks whether reasonable jurors could find by a preponderance of the evidence that the [non-movant] is entitled to a verdict.

 Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). In order to survive a motion for summary judgment, then, the nonmoving party must present "more than a mere scintilla of evidence" in its favor and "cannot simply reallege factually unsupported allegations contained in [its] pleadings." Id. at 249, 325; see also Maguire v. Hughes Aircraft Corp., 912 F.2d 67, 72 (3d Cir. 1990). Only evidence that would be admissible at trial may be used to test a summary judgment motion. Evidence with a deficient foundation must be excluded from consideration. Williams v. Borough of West Chester, PA, 891 F.2d 458, 466 (3d Cir. 1989); see also Trap Rock Indus., Inc. v. Local 825, Int'l Union of Operating Eng'rs, 982 F.2d 884, 890-91 (3d Cir. 1992).

 It is clear that the Generator Defendants seek judgment in their favor on all of NJTA's claims -- under CERCLA, the Spill Act and New Jersey common law. It is surprisingly unclear, however, whether NJTA cross-moves for summary judgment on all of its claims or just on its CERCLA and Spill Act claims. NJTA's brief in support of its cross-motion contains a "Scope Note," which notifies the reader that the arguments found therein serve a dual purpose: to respond to the motions of the Generator Defendants and to support its own cross-motion for summary judgment "as to liability." (See NJTA Cross-Motion Br. at 1). It is apparent from its arguments that NJTA moves for summary judgment on its CERCLA claim. Presumably, this is its intention with respect to its Spill Act claim as well. However, although NJTA also repeatedly states that it has made out a "prima facie " case for "common law liability," its arguments are not directed toward demonstrating an absence of a genuine issue of material fact with respect to any of its common law claims. These are discussed in greater detail in Section IV, below.

 II. CERCLA LIABILITY

 A. STATUTORY FRAMEWORK

 Congress enacted CERCLA, 42 U.S.C. § 9601 et seq. and, later, the Superfund Amendments and Reauthorization Act ("SARA"), 42 U.S.C. § 9613, in order "to provide for liability, comprehensive cleanup, and emergency response for hazardous substances released into the environment and the cleanup of inactive hazardous waste disposal sites." United States v. Rohm & Haas Co., 939 F. Supp. 1142 (D.N.J. 1996) (citing Pub.L. No. 96-510, Stat. 2767 (1980) (purpose clause)). CERCLA's statutory framework provides liability for any

 
(1) current owner or operator of a facility;
 
(2) person who owned or operated the facility at the time of the disposal of a hazardous substance;
 
(3) person who arranged for disposal or treatment, or arranged for transport for disposal or treatment, of hazardous substances at the facility; and
 
(4) person who accepts or accepted hazardous substances for transport to sites selected by such person.

 U.S. v. CDMG Realty Co., 96 F.3d 706, 713 (3d Cir. 1996) (citing 42 U.S.C. § 9607(a)(1)-(4)). Section 107(a) of CERCLA renders all four of these classes of potentially responsible parties ("PRPs") liable for "all costs of removal or remedial action incurred by the United States Government or a State or an Indian Tribe," as well as "any other necessary costs of response incurred by any other person." 42 U.S.C. § 9607(a)(4)(A) and (B). Section 113 of SARA provides that "any person may seek contribution from any other person who is liable or potentially liable under [section 107] . . . ." Id. at § 9613(f)(1).

 An action under § 107 differs from an action under § 113 in one significant respect: a § 107 action can be brought only by innocent parties that have undertaken clean-ups. an action brought by a PRP, on the other hand, is by necessity a § 113 action for contribution. See New Castle County v. Halliburton NUS Corp., 111 F.3d 1116, 1120, reh'g denied, 116 F.3d 82 (3d Cir. 1997). In essence, a § 107 "cost recovery" action imposes strict liability on PRPS for costs associated with waste cleanup and remediation and also imposes joint and several liability of PRPs. In contrast, a § 113 "contribution" action allows one PRP to recoup that portion of its expenditures which exceeds its fair share of overall liability. 111 F.3d at 1121-22. In order to establish CERCLA liability under either § 107 or § 113, a plaintiff must prove the following:

 
(1) that the defendant falls within one of four categories of "responsible parties;"
 
(2) that "hazardous substances" *fn4" were disposed of at a "facility;" *fn5"
 
(3) that there has been a "release" *fn6" or "threatened release" of hazardous substances from the facility into the environment; and
 
(4) that the release or threatened release has required or will require the plaintiff to incur "response costs."

 42 U.S.C. § 9607(a); CDMG Realty Co., 96 F.3d at 712.

 In the instant case, NJTA seeks to hold the Generator Defendants liable as entities who "arranged for disposal" or "arranged for the transport" of a hazardous substance for disposal at each of the seven sites in question, see 42 U.S.C. § 9607(a)(3), under both § 107 and § 113 of CERCLA. In other words, NJTA is pursuing herein both a cost recovery claim as well as a contribution claim. For purposes of the instant motion, there is no dispute that COPR is a "hazardous substance" within the meaning of CERCLA, that the Generator Defendants (or their predecessors) were producers of COPR or that COPR was, in fact, discovered at each of the seven sites in question. A significant dispute exists, however, as to whether the COPR found at these seven sites can be linked to COPR produced by each of the Generator Defendants.

 B. SECTION 107 CLAIM

 NJTA's attempt to proceed on its cost recovery claim under § 107 of CERCLA fails as a matter of law because NJTA itself is a PRP under the clear language of the statute. There is no dispute that NJTA is the current owner and operator of all seven sites in question. CERCLA's plain language clearly provides that current owner or operator of a facility is one of the four categories of PRPs liable for all costs of removal or remedial action. 42 U.S.C. § 9607(a)(1). As a PRP, NJTA is limited to bringing a claim for contribution under § 113 and cannot as a matter of law maintain a cost recovery claim under § 107. Every court of appeals that has examined this issue agrees that a § 107 cost recovery action may be brought only by innocent parties that have undertaken cleanups. See New Castle, 111 F.3d at 1120 (citing cases). Here, NJTA is neither an innocent party nor a party that has undertaken clean up of any of the sites question. Accordingly, its claim under § 107 of CERCLA must be dismissed.

 In a obvious attempt to avoid this inevitable result, NJTA advances the curious argument that, despite its status as the current owner and operator of all seven sites in question, it may nevertheless maintain a § 107 cost recovery action because, for recovery purposes, it qualifies as the State. NJTA does not, of course, explain how its alleged status as the State exonerates it from the liability clearly imposed upon it as a PRP under CERCLA. Rather, it merely discusses at length the reasons why it must be considered the equivalent to the State for purposes of recovery. The Court determines that the question of whether NJTA is the State is wholly irrelevant to this action, wherein there is no dispute that NJTA is the current owner or operator of the seven sites in question. The Court notes only that it seriously doubts that NJTA falls within CERCLA's definition of "state," *fn7" especially given that courts of this State have repeatedly recognized (although not in the CERCLA context) NJTA as analogous in many respects ...


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