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Grand Street Artists v. General Electric Co.

December 30, 1998

GRAND STREET ARTISTS, ET AL.,
(HAA)
PLAINTIFFS,
V.
GENERAL ELECTRIC COMPANY, ET AL.,
DEFENDANTS
PARKER, ET AL.,
PLAINTIFFS,
V.
GENERAL ELECTRIC COMPANY, ET AL.,
DEFENDANTS.



FOR PUBLICATION

OPINION

Ackerman, D.J.

This matter comes before the court upon a motion for judgment on the pleadings or, in the alternative, a motion for summary judgment by the defendant, General Electric Corporation ("GE"), which is joined in its motion by defendants John and David Pascale (together with GE the "Defendants"). The Defendants' motion seeks entry of a declaratory judgment finding the plaintiffs who are individual-unit owners *fn1 ("Owner-Plaintiffs") liable under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"). For reasons detailed below, Defendants' motion for summary judgment is GRANTED.

I. Background

For purposes of the instant motion, the relevant facts are as follows. On August 4, 1993, a New Jersey partnership formed by artists, Grand Street Artists ("GSA"), purchased the premises at 720-732 Grand Street, Hoboken, New Jersey (the "Facility") which formerly had been used for industrial purposes. The intention of the GSA partnership (the "Partnership") was to convert the premises into residential condominium units and working lofts and, ultimately, to sell such units to the partners in their individual capacities. (Stein Aff., Exh. J, p.1.) Under the GSA partnership agreement (the "Partnership Agreement"), "...the Partnership was to be comprised 'of 17 ownership interests,' with each 'Partnership Interest' giving each individual partner the right to acquire one condominium unit." (Plaintiffs' Memorandum of Law in Opposition to the Motion of Defendant General Electric Company for Partial Summary Judgment ("Pl. Mem."), at 15 (quoting Partnership Agreement).) The Partnership Agreement also provided that each partner "covenants and agrees that, upon the conversion of the Property to the condominium form of ownership, he will purchase the unit specified on the building plan and list annexed...as Exhibit H ...[to the Partnership Agreement]." (Pl. Mem., at 15 (quoting Partnership Agreement).) Ultimately, all but two of the units were sold by GSA to the Owner- Plaintiffs. *fn2 All of such transactions took place after May 1, 1995. (GE's Statement of Material Facts Not in Dispute ("GE's MFND"), ¶ 26 not disputed by Owner-Plaintiffs.)

Prior to completing the sale and transfer of ownership of the individual units from GSA to the Owner-Plaintiffs, GSA and Owner- Plaintiffs became aware of the presence of mercury on the premises. Although there is a factual dispute as to when GSA and Owner-Plaintiffs first became aware of the presence of mercury, the parties agree that by May 1, 1995, GSA and the Owner-Plaintiffs were aware of the mercury, its presence was discussed in at least five GSA partnership meetings, and GSA had hired Defendant ENPAK Services to investigate the presence of mercury on the premises prior to that date. (GE's MFND ¶¶ 18-25, not disputed by Owner-Plaintiffs.) While it was at first believed that remedial steps could be taken to contain the mercury, the artists were ultimately forced to evacuate. On January 3, 1996, the Agency for Toxic Substances Disease Registry concluded that an imminent health hazard existed and on January 4, 1996 the Hoboken Health Department found the premises unfit for human habitation. (Pl. Mem. of Law at 5.) In July of 1997, the EPA recommended that the premises be demolished, the residents be permanently relocated, and future monitoring and sampling of the soil and ground water be carried out. (Id. at 5 (citing Stein Aff., Exh. A).) The implementation of the EPA's recommendations was estimated to cost $13.9 million. (Id. at 5 (citing Stein Aff., Exh. A).)

Thereafter, the individual artists (Owner-Plaintiffs) and GSA brought suit against a number of defendants alleging violations of CERCLA, the Environmental Clean Up Responsibility Act ("ECRA"), the New Jersey Spill Compensation and Control Act, the New Jersey Consumer Fraud Act, and common law claims for strict liability, negligence, fraud, recision, public nuisance, and punitive damages. The defendants are environmental consultants, the law firm retained by GSA for advice on the purchase of the facility, and prior owners of the premises, including GE, Cooper-Hewitt Electric Corp., Quality Tool & Die Co., John Pascale and David P. Pascale. GE has filed, and John and David Pascale have joined, in the instant motion.

In Count Two of their complaints, Owner-Plaintiffs seek declaratory judgment stating that they are each entitled to the "innocent owner" defense and, thus, are not liable under CERCLA. The First Counterclaim of GE's Amended Answer and Counterclaim seeks declaratory judgment finding that Owner-Plaintiffs are liable under CERCLA. In the instant motion, Defendants move for a judgment on the pleadings or, in the alternative, summary judgment finding Owner-Plaintiffs liable under CERCLA. Since granting Defendants' motion for summary judgment requires an inquiry beyond the pleadings, the court will consider Defendants' motion for summary judgment, and finds the court's holding regarding that motion dispositive as to Defendants' motion for a judgment on the pleadings.

II. Summary Judgment Standard

Federal Rule of Civil Procedure 56 provides that summary judgment may be granted only if the pleadings, supporting papers, affidavits, and admissions on file, when viewed with all inferences in favor of the nonmoving party, demonstrate that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). See also Todaro v. Bowman, 872 F.2d 43, 46 (3d Cir. 1989); Chippolini v. Spencer Gifts, Inc., 814 F.2d 893, 896 (3d Cir.), cert. dismissed, 483 U.S. 1052 (1987). In other words, "summary judgment may be granted if the movant shows that there exists no genuine issue of material fact that would permit a reasonable jury to find for the nonmoving party." Miller v. Indiana Hosp., 843 F.2d 139, 143 (3d Cir.), cert. denied, 488 U.S. 870 (1988).

The substantive law will identify which facts are "material." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). Therefore, "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Id. An issue is "genuine" if a reasonable jury could possibly hold in the non-movant's favor with regard to that issue. Id.

The party seeking summary judgment always bears the initial burden of production, i.e., of making a prima facie showing that it is entitled to summary judgment. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). This may be done either by demonstrating there is no genuine issue of fact and that as a matter of law the moving party must prevail, or by demonstrating the nonmoving party has not produced evidence relating to an essential element of the issue for which it bears the burden. Id. at 322-23. Once either showing is made, the burden shifts to the nonmoving party who must demonstrate facts supporting each element for which it bears the burden as well as establish the existence of genuine issues of material fact. Id. at 324.

However, at the summary judgment stage, a court may not weigh the evidence or make credibility determinations--these tasks are left to the fact finder. See Petruzzi's IGA v. Darling-Delaware, 998 F.2d 1224, 1230 (3d Cir.), cert. denied, 510 U.S. 994 (1993). Therefore, to raise a genuine issue of material fact, "'the [summary judgment] opponent need not match, item for item, each piece of evidence proffered by the movant,' but simply must exceed the 'mere scintilla' standard." Id. See also Anderson, 477 U.S. at 252 ("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 [non-movant]."). "Although a `scintilla of evidence' supporting the non-movant's case is not sufficient to defeat a motion for summary judgment, it is clear that a district court should not weigh evidence and determine the truth of the matter itself, but instead should determine whether there is a genuine issue ...


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