Environmental due diligence is a critical component of any property transaction where potential environmental risks are a concern—minimize risks and protect yourself from...
The federal government shouldn’t have been let off the hook for superfund cleanup costs at a California aeronautical manufacturing plant, the U.S. Court of Appeals for the Ninth Circuit ruled Oct. 4 ( TDY Holdings, LLC v. United States , 9th Cir., No. 15-56483, 10/4/17 ).
The Ninth Circuit said a district court improperly allocated 100 percent of the cleanup costs at the San Diego plant to TDY Holdings LLC, given how closely the U.S. military was involved in plant operations as early as the 1940s, the court said.
The ruling gives TDY and its corporate predecessor, Ryan Aeronautical Co., a fresh opportunity to argue that the Department of Defense should bear some cleanup costs stemming from the release of toxic chemicals required by government contracts dating back to World War II.
The cost allocation was a “sharp deviation” from court decisions interpreting the Comprehensive Environmental Response, Compensation, and Liability Act, the Ninth Circuit said.
The manufacturing operation, which closed in 1999, released polychlorinated biphenyls, as well as chromium compounds and chlorinated solvents, both of which were required by the federal government to ensure product quality, according to the decision.
Saddling the military contractor with all cleanup costs primarily incurred in war-effort production “was a 180 degree departure from our prior case law” and out-of-circuit cases, particularly when the government required the use of two of the chemicals before their toxicity was recognized, the court said.
The government also had agreed to pay some of the cleanup costs at the plant in some of the contracts, the court said.
Circuit Judge Paul J. Watford concurred in the decision but said most of the costs still should be allocated to TDY.
U.S. Circuit Judge Morgan Christen wrote the opinion, joined by Judges J. Clifford Wallace.
The law offices of Morgan Lewis & Bockius represented TDY.
The opinion is available at http://src.bna.com/s6O.
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)