Environmental due diligence is a critical component of any property transaction where potential environmental risks are a concern—minimize risks and protect yourself from...
Increased litigation is expected on four hot-button superfund issues, one of which is likely to end up in the U.S. Supreme Court, experienced environmental litigators predicted June 26.
Administrative orders on consent, arranger liability, bona fide purchasers and parent company liability will keep litigators busy for years, Robert Fox, of Manko, Gold, Katcher & Fox in Bala Cynwyd, Pa., predicted.
Fox and Justin Savage, of Hogan Lovells in Washington, D.C., said the trends are driven by the vagaries of the superfund law, the fact-specific inquiries it requires and the potentially huge cost of cleaning up hazardous waste sites.
“Now it's billions of dollars and people are going to litigate that,” Fox said.
Fox and Savage spoke at the American Law Institute's conference on environmental litigation in Washington.
Fox and Savage predicted administrative orders on consent (AOC)—a staple of state and federal environmental settlements—may be the single biggest litigation issue ahead.
Savage, who formerly litigated environmental cases at the U.S. Department of Justice, said “boilerplate” settlement language in AOCs often is drafted years before intervening case law and that muddles later judicial interpretations.
“No one was thinking about these decisions” when the standard settlement terms were drafted, Savage said.
For example, vexing issues (and conflicting decisions) arise over what starts the clock for filing Section 107 cost recovery and Section 113 contribution actions following a settlement under the Comprehensive Environmental Response, Compensation, and Liability Act, he said.
Fox said differing language in the agreements drives judicial interpretations—and changing that language isn't easy.
“States and the federal government have their model consent agreements, and they don't like to change them,” Fox said.
“This will likely go back to the Supreme Court, which is going to want to clarify this issue,” he said.
Cost recovery claims, unlike contribution actions, allow for joint and several liability with a more generous statute of limitations. Parties that enter into settlements with the government generally are limited to contribution claims.
Fox and Savage agreed that questions of arranger liability, as well as parent company and successor liability, also provide fodder for future litigation.
The same holds true for CERCLA's bona fide prospective purchaser defense (42 U.S.C. §9607(r)(1)), which Fox said was “going to be litigated for years and years,” driven both by the eight-part inquiry it commands and the uncertain cleanup costs a buyer faces if the defense fails.
“I don't think we're going to see any reduction in superfund litigation,” Fox said. “Every few years, the Supreme Court issues a new opinion that resets the landscape.”
“There were 41 CERCLA appellate decisions from January 2014 up to now,” Savage added. “Predictions that CERCLA liability would be settled were wrong.”
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)