# Petition for Writ of Certiorari — Monsanto Co. v. United States > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385002_0954%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1989 - **Citation:** 490 U.S. 1106 ## Text No IN THE Supreme Court of the Gnited States October Term, 1988 MONSANTO COMPANY, ALLIED-SIGNAL, INC. AND EM INDUSTRIES, INC.., Petitioners, v. UNITED STATES OF AMERICA, SOUTH CAROLINA DEPARTMENT OF HEALTH AND ENVIRONMENTAL CONTROL, Respondents. PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT GEORGE CLEMON FREEMAN, JR. (COUNSEL OF RECORD) ALFRED R. LIGHT [THOMAS E. KNAUER Hunton & Williams 707 East Main Street Richmond, Virginia 23219 804/788-8200 Counsel for Petitioners February 23, 1989 QUESTIONS PRESENTED . Can a court, over a defendant's objection, mandate bifur- cation of liability and allocation issues in a cost recovery suit under The Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (*°CERCLA”™) into two separate actions without complying with Federal Rule of Civil Procedure 54(b)”? in fashioning a uniform “‘federal common iaw” for when joint and several liability is appropriate under CERCLA, did the court below err in adopting the standard of liability under Section 433A of the Restatement (Second) of Torts but rejecting the burden of proof provisions of Section 433B? . By creating federa! rights and remedies outside congres- sional guidelines, did the court below ignore this Court's recent admonitions to lower federal courts, based on separation of powers principles, to avoid unguided resolu- tion of important questions of public policy. LIST OF PARTIES The parties to the proceeding below were the United States of America. the South Carolina Department of Health and Environmental Control, Oscar Seidenberg, Harvey Hut- chinson, Monsanto Company, Allied-Signal, Inc. (formerly Allied Corporation), and EM Industries, Inc. EM Industries ts a Wholly owned subsidiary of Merck A.G., Zug., Switzerland. Monsanto Company owns less than 100 percent of the follow- ing companies: Monsanto Chemicals of India Limited Monsanto Chemical (Thailand) Limited Monsanto (Malaysia) Sdn. Berhad P. T. Monagro Kimia Advent Eurofund Limited Advent Techno Venture Investment Corp. N.V. Andreae-Noris-Zahn AG (ANZAG) Biolab Industrias Farmaceuticas S.A. (BIOLAB) Chipman Limited Companhia Brasileira de Estireno (CBE) Fosbrasil S.A. HybriTech Europe SNC Industrias Resistol, S.A. (IRSA) Invitron Corporation Kinetek Systems Incorporated K.K. Astro Korag Company Limited Korsil Company Limited (KORSIL) Kumho Monsanto Inc. (KMI1) Mitsubishi Monsanto Chemical Company (MMK) Nippon Cooper Kabushiki Kaisha Nomix Manufacturing Company Limited Nomix ple Oxford Glycosystems Limited (OGS) Ryowa K. K. Taikomenban Kogyo Tsukuba Service Company, Ltd. Table of Contents Questions Presented. . * An ess List of Parties ....... Cr ee et i Opmions Below ............... Statement of Jurisdiction .............. 7h Constitutional and Statutory Provisions Involvec 2 TS OS 3 Reasons for Granting the Writ)... ....... eae : 11 Ee ao Sd lI 1. THE COMPULSORY TWO-ACTIONS I Ay ont 2 13 A. THE MAJORITY OPINION BELOW DISREGARDED EQUI- TABLE PRINCIPLES BY TREATING DEFENDANTS EQUI- TABLE RIGHT TO REDUCTION OF THE AMOUNT RE- COVERABLE BY THE PLAINTIFFS AS A COUNTERCLAIM I gk es ht ee ee 13 B. THE MAJORITY OPINION BELOW FAILED TO CONSIDER THE GOVERNING PROCEDURAL LAW AND THE FACT I'HAT THE LOWER COURT DID NOT MAKE THE EX- PRESS DETERMINATION UNDER RULE 54(b) REQUIRED FOR A BIFURCATED DECISION. INSTEAD, IT CREATED 4 DE FACTO EXCEPTION TO THE FEDERAL RULES OF! Civil PROCEDURE FOR CERCLA CASES .......... 15 C. BECAUSE IT PROVIDES NO MECHANISM FOR ADJUST- ING SETTLEMENT AMOUNTS, THE RULING BELOW MAY RESULT IN DEFENDANTS ULTIMATELY BEING LIABLE FOR MORE THAN THEIR JUST PORTION OF RE- SPONSE COSTS AND AFFORD THE PLAINTIFFS DOUBLE RECOVERY. THIS COULD POSE MAJOR CONSTITU- a 17 Il. THE BURDEN OF PROOF ISSUE ............. 24 eg ke ee we ee hes es 29 Appendices A. ORDER OF THE UNITED STATES COURT OF APPEALS Semue) EPECEMBER 2.19088 .................0. A-| B. OPINION OF THE UNITED STATES COURT OF APPEALS DATED SEPTEMBER 7, 1988 ............ B-] C. ORDER OF THE UNITED STATES COURT OF APPEALS Seemenuementyed 90, 10665..................4.. C-] D. AMENDED JUDGMENT OF THE UNITED STATES Dis- rRICT COURT DATED SEPTEMBER 23, 1986 ........ D-| ill OPINION OF THE UNITED STATES DISTRICT COURT DATED FEBRUARY 22. 1984 FE. ORDER OF THE UNITED STATES DISTRICT COUR DATED DECEMBER i9g, iG&S FINAL OrbDER OF THE UNITED STATES CourRT DATED AUGUST 14. 19386 H. OPINION OF THE UNITED STATES DISTR Court, Mo_aA DEVELOPMENT CORP STATES. DATED MAy 6 lable of Authorities Cases 1B. Small ( { Su R ( lL! S. 233 (1925 Ba s Lu a ® ] ( ( rer 1 tps IOS S. ¢ 1645 (1988 Bowen Vv. Georgetown [ H U.S 109 S. Ct. 468 (1988 ( } vy. S ra Club, 451 U.S. 28 Q& ( tf Ne Yor Exxon Cor 697 F. Suny S.D. N.Y QRS } } O homa. 455 U.S. 104 89 ot His 5 / (21D r ¢ } \ f Va ChlLU No. 85 C 1142, slip op.. re nted in Haz. W Rey 12.055 (N.D. Tl. 198° IN¢ ailable o Gented libra Dist file / al Savi t n insu Co? kK 816 F.2d '30 (4th ¢ 1987 ¢ Wi tik U.S. 333 74 k Disnasal. Im Brownine-Ferris Ind Vermont, I} 845 F.2d 404 (2d Cir. 1988). } ( 109 S. Ct. $27 (1988) 1¢ ! | + | Page > f if tf 2] / 4 iSl¢ | ! 1 LEXIS > Page Middlesex County Sewerage Authority v. National Sea Clammers Ass'n., 453 U.S. 1 (1981) Payne v. Hook, 74 U.S. 425 (1869) S Pennsylvania v. Union Gas Company, 832 F.2d 1343 (3d Cir. 1987). cert Prantle d, is S&S. Ct i719 (1988), argued, Oct. 31, 1988 1s Ratner v. Sioux Natural Gas Corp., 719 F.2d 801 (Sth Cir. 1983), appeal after remand, 770 F.2d S12 (1985) 20 Solem v. Helm, 463 U.S. 277 (1983) 22 Stone v. White, 301 U.S. $32 (1937) 13.14.15 Texas Industries, Inc. v. Radcliff Materials, Inc., 45] U.S. 630 (1981) 27 Touche Ross & Co. v. Redington, 442 U.S. 560 (1979) 2/ Transamerica Mortgage Advisors, Inc. v. Lewis, 444 U.S. 11 (1979) .. a 2) United States v. Conservation Chemical Co., 619 F.Supp. 162 (W.D. Mo. 1985) 10,23 United States v. Hardage, 26 Env't Rep. Cas. (BNA) (W.D. Okla. 1987) ..... 14.24 United States v. Moore, 28 Env't Rep Cas. (BNA) 1150 (E.D.Va. 1988) . 16.20 United States v. Mottolo, 605 F. Supp. 898 (D. N.H > ee 16.19.24 United States v. Nicolet, Inc., No. 85-3060, slip op (E.D. Pa. Dec. 31, 1986) (available on LEXIS, Genfed library, Dist file) .... / 16 ‘nited States v. Northeastern Pharmaceutical & Chem { ical Co., 810 F.2d 726 (8th Cir. 1986), cert. denied 108 S. Ct. 146 (1987) ... eae 19 United States v. Shell, 605 F Supp 1064 (D. Colo yt) ee eee § 24 Inc., 653 F. Supp. 984 (D. S.C. 1984), aff'd in part, vacated in part sub nom., United States v. Monsanto Co., 858 F.2d 160 (4th Cir. 1988) . . passim United States v. Ward, 448 U.S. 242 (1980) 22 Universities Research Ass'n. v. Coutu, 450 U.S. 754 (1981) Aa WitOn » SPENCE) andbags Orp.. 765 « 6 (2 Vuitton v. Sj Handl ( 65 F.2d Yb Cir. 1985S) Leas Weave rv Graham. 450) { S 24 (1981) Constitutional Provisions U.S. Const. Amend. \ U.S. Const. Amend. VIII Statutory Provisions Prmtsieetcive Savisonmental Response, | ) id Liabilit Act of 1980. 4 S ( 1675 (1982 & Supp. IV 198¢ Section 106. 42 U.S.( JE RIK S 1QR6 Section 107, 42 U.S.( ¥ 27 & S 1986) section 10 oY, | S» ( A017 < - Section 107(a)(3), 42 U.S. S JOT (a3 Supp 19X6) Section 113. 42 U.S.C. § 9613 (1982 & Supy 19X86) section 11 3(f). 4) | 5 \ OF if Supp Section 113(f)(1). 42 U.S.C. §96134 (Supp IV 1986) Section 113(f)(2). 42 U.S.C. 8961342) (Supt Section 114(b), 42 U.S.C. §$ 9614(b) (1982 Resource Conservation and Recovery Act. 42 | 691) 1-699 11 (198? & Supp IV 1986) Section 7003, 42 U.S.C. § 6973 (1982 & Supp 28 U.S.C. § 1254(1) (Supp. IV 1986) Rules Federai Rules of Civil Procedure Rule 13a) Rule 54(b) aye Vliscellaneous * \ \ ( f )< /) ( k i 5 1-2 B < ry ( ( { \ x IX : ISS } \ 4 ne f c ct S% . ys Ne S. Code g & Ad. N s f ‘ ( / \ k IN¢ \ ’ k ) \A ( { } } ( \ } } Ss S $33] 4,24,2° Sc 433} 49.94 * Sec 433B. ¢ Ss k > , / ) \ atomint ) S. SI. 98th Cong Ist Sess 1}QOXS is reported by Ser Environment and Public Works Committee S. Hrng. 60, Superfund Improvement Act of 1985S, He g on S.S1 and 8.494 before the Committee on I ment and Public Works. United States Senate, 99tl Cong.. Ist Sess. (Feb. 25, 1985) % Hrng 61. Insurance Issue ‘ ad? ad 5 i] ervitd ‘ Hearings before the Committee on Environment and Public Works. United States Senate, 99th Cong., Ist Sess (April 3, 1985) S. Hrng. 415, Superfund Improvement Act of 1985, H¢ ings on 8.51 before the Committee on the Judic! United States Senate. 99th Cong., Ist Sess. (June 1ORS) 16 S. Rep. No. 11. 99th Cong Ist Sess. (1985) IN THE Supreme Court of the Gnited States October Term, 1988 ee Monsanto Company, Aliied-Signal, Inc. and EM Industries, Inc., Petitioners, Vv. United States of America, South Carolina Department of Health and Environmental Control, Respondents. PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT Monsanto Company, Allied-Signal, Inc. and EM Indus- tries, Inc. respectfully petition the Court for a writ of certio- rari to review the judgment of the United States Court of Appeals for the Fourth Circuit in this case. OPINIONS BELOW The opinion of the court of appeals (App. B) is reported as United States v. Monsanto Co., 858 F.2d 160 (4th Cir. 1988). The opinion of the district court (Anp. E) is reported in United States v. South Carolina Recycling & Disposal, Inc.., 653 F. Supp. 984 (D. S.C. 1984). STATEMENT OF JURISDICTION The judgment of the court of appeals was entered on September 7, 1988. A timely petition for rehearing and sug- gestion for rehearing in banc was denied on December 2, 1988 by a § to 4 vote of the sitting judges. two having recused themselves (App. A). The jurisdiction of the Court is invoked under 28 U.S.C. § 1254(1). CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED Amendment \ No person shall be ... deprived > eae property. without due process of law. Amendment VIII Excessive bail shall not be required. nor excessive fines imposed . CERCLA Section 107(a) (a) Notwithstanding any other provision or rule of law, and subject only to the defenses set forth in subsection (b) of this section. (3) any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a iransporter for transport for dis- posal or treatment. of hazardous substances owned or possessed by such person, by any other party or entity, at any facility or incineration vessel owned or operated by another party or entity and contain- ing such hazardous substances . from which there ts a release, or a threatened release which causes the incurrence of response costs. of a hazardous substance, shall be liable for— (A) all costs of removal or remedial ac- tion incurred by the United States Gov- ernment or a State or an Indian Tribe not inconsistent with the national contingency plan: (B) any other necessary costs of response incurred by any other person consistent with the national contingency plan. CERCLA Section 113(f)(1), (2) (1) CONTRIBUTION.—Any person may seek contribution from any other person who ts liable o1 yd potentially liable under section 107(a), during or following any civil action under section 106 or under section 107(a). Such claims shall be brought in accordance with this section and the Federal Rules of Civil Procedure, and shall be governed by Fed- eral law. In resolving contribution claims, the court may allocate response costs among liable parties using such equitable factors as the court determines are appropriate. Nothing in this subsection shall diminish the right of any person to bring an action for contribution in the absence of a civil action under section 106 or section 107. (2) SETTLEMENT.—A person who has resolved its liability to the United States or a State in an administrative or judicially approved settlement shall not be liable for claims for contribution regard- ing matters addressed in the settlement. Such set- tlement does not discharge any of the other poten- tially liable persons unless its terms so provide, but it reduces the potential liability of the others by the amount of the settlement. STATEMENT OF THE CASE I. The Legal Questions Presented This is an appeal from a judgment holding Monsanto Company, Allied-Signal, Inc. and EM Industries, Inc. (the “generator defendants” or “‘petitioners’’) jointly and sever- ally liable to the United States and South Carolina (collec- tively called the ““governmenis’’) under Section 107(a)(3) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“CERCLA”), 42 U.S.C. § 9607(a)(3)(Supp. IV 1986), for response costs arising from the release or threat of release of hazardous substances from the Bluff Road hazardous waste storage facility. It is one of the first test cases to determine the scope of CERCLA liability under a confusing and poorly drafted statute. The decision below involved (1) the substantive standards of liability under that Act, (2) two procedural issues and (3) difficult constitu- tional questions. Despite the importance of all these questions, petitioners seek review of only two closely related procedural issues. If these two issues are correctly resolved. the harshness of the lower court's substantive holdings can be mitigated and difficult constitutional issues otherwise presented avoided. The first procedural issue is clear cut: Whether CERCLA preempts the Federal Rules of Civil Procedure and principles of equity applicable to actions for restitution so as to give a district court discretion to enter final judgment against a defendant for all cleanup costs the plaintiff has incurred without any adjustments in the award for the share of respon- sibility of the plaintiff and those who settled with the plaintiff. The decision below not only departs from the long-standing principle that in an equitable proceeding the court will decide all matters in dispute and decree complete relief, but it is also directly contrary to congressional intent as reaffirmed in the 1986 amendments to CERCLA. There Congress rejected an amendment sponsored by the Government that would have preempted the Federal Rules of Civil Procedure and the normal rules of equity and substituted compulsory bifurcation of CERCLA liability and allocation issues. Congress instead mandated in new CERCLA § 113(f)(1) continued adherence to the Federal Rules of Civil Procedure and specifically autho- rized defendants to seek contribution “‘during or following” a CERCLA § 107 action. The second procedural issue is also clear cut. The court below held that Section 433A of the Restatement (Second) of Torts sets forth the uniform federal *‘common law”’ rule for application of joint and several liability under CERCLA. That section contemplates that the burden of proof as to apportion- ment will be determined by Section 433B. Section 433B in turn provides that the burden is normally upon the plaintiff, with two exceptions. One exception, clause (2), provides that where actions of the defendant and others contributed to the plaintiffs harm and the defendant seeks to limit his liability, the defendant has the burden. But comment d in the Restate- ment makes it clear that the exception in clause (2) Is applicable only where the plaintiff is “‘entirely innocent.”’ In the context of CERCLA, this is where the plaintiff is not himself a “‘potentially responsible party’> under CERCLA because he did not also contribute to the harm remedied by the cleanup. The court below took the half of the Restatement rule which defines who can be held jointly and severally liable but failed to follow the second half which lays down who has the burden of proof. Yet under Section 433B, it is clear that because the governments’ wastes also contributed to ihe harm remedied, the burden was upon the plaintiff governments to prove defendant generators’ apportioned contribution to the harm. Thus, the courts below erred in holding that the burden of proof of apportionment was on the generator defendants. If left standing, the precedents below pose substantial problems in a number of ongoing cases. First, they will substantially increase the likelihood that the ultimate inci- dence of CERCLA’s retroactive liability will be unfair and perhaps so grossly disproportionate in some instances as to be unconstitutional. Second, because the Fourth Circuit's posi- tions on apportionment of CERCLA liability are fundamen- tally inconsistent with that taken by district courts in the First, Second, Third, Seventh, Ninth and Tenth Circuits, also seeking a uniform CERCLA ‘‘federal common law”’ rule, the decision below portends an impending split among the cir- cuits. II. Their Factual and Procedural Context Both questions presented arise out of the cleanup of the Bluff Road site, a waste storage facility operated between 1972 and 1980 by industrial waste haulers licensed by South Carolina. Both governments, generator defendants, and as many as 78 other waste generators contracted with the waste haulers for disposal or treatment of their wastes. The Federal agencies that disposed of their wastes included the U-S. Environmental Protection Agency (“‘EPA’’), the Centers for Disease Control (**CDC’’), the Air Force and the Army. There is no allegation that generator defendants, the govern- ments or any other generators violated any then-existent law or regulation through their disposal arrangements or that they were negligent in any way. Thus, all who dealt with the waste haulers were within the same class of waste generators, whether their conduct giving rise to strict liability under CERCLA is viewed as “‘tortious’’ or “‘innocent’’ in the context of the common law principles set forth in Section 433 of the Restatement (Second) of Torts. The Federal Government initially filed suit against the waste haulers, seeking abatement of releases from the site under Section 7003 of the Resource Conservation and Recov- ery Act (*RCRA’’), 42 U.S.C. § 6973 (1982 & Supp. IV 1986). South Carolina intervened as a plaintiff. Thereafter, both plaintiffs entered into a partial consent decree with one waste generator, RAD Services, Inc. (*RAD”’) for cleanup of 75% of the surface at the site. Under the settlement RAD was to be paid $1,597,785 for cleanup work from a Settlement Fund to be administered by South Carolina. Also, RAD agreed to contribute specified services. Separately, the plaintiffs en- tered into settlement agreements with twelve other waste generators. In exchange for payments to the fund, the plain- tiffs released them from all claims arising out of the surface cleanup. The Government contributed $51,975 to the Settle- ment Fund for EPA’s wastes, but nothing for the wastes of other agencies. South Carolina contributed nothing for its wastes. These settlements grew out of the Government's investiga- tions to identify all generators whose wastes were handled by the waste haulers. Prior to the settlements, the Government com- piled a preliminary list of 75 entities that had contracted with the haulers. The Government then picked 24 from the list and proposed the allocation of the cleanup costs among them on a volumetric basis. The apportioned shares were based on the ‘‘Waste Quantity (gallons)”’ that the haulers’ records showed had been handled for each generator, divided into the total volume of wastes handled for all those on this short list. The Government's omission of the volumes of wastes of South Carolina and 41 other identified generators who were not in- cluded on the short list thus increased the percentages attributed to those included on the short list. Under the Government's apportionment scheme, the volume allocated to Federal agen- cies totaled 3.07% (EPA 1.89%, the Air Force 0.57%, CDC 0.41% and the Army 0.20%). The volumes allocated to the three generator defendants were: Allied 12.23%, EM Industries 8.27% and Monsanto 1.91%. The volumes allocated to the 15 genera- tors who then or subsequently settled with the Governments aggregated 77.5%. The generator defendants refused to settle because (1) they maintained that their wastes were not at the site at the time of cleanup, (2) they differed with the governments as to the appropriate interpretation of the statute and (3) the governments were not proposing to shoulder an equitable share of the cleanup costs even under their theory of liability. So the governments filed a Second Amended and Supplemen- tal Complaint adding the three generator defendants and three additional parties. Subsequently the plaintiffs moved for par- tial summary judgment on the issue of each generator defend- ant’s joint and several liability under CERCLA § 107. The court accepted the governments’ theory that the plaintiffs need not show that a defendant's wastes were at the site at the time of cleanup. The court ruled that [ajll they have to show was that at one time they [the defendants’ wastes] were on the site. And further, that at the time of the cleanup, that waste materials like, or the same as the generator defend- ants was at the site. Whether it was any of the four defendant’s materials or not. Transcript of Proceedings before the Hon. Charles E. Simon, Jr., Jan. 13, 1984, at 23. The defendants argued that the evidentiary dispute as to whether their wastes were on-site at cleanup time was also material to the joint and several liability issues of *‘indivisi- bility’’ and ‘‘apportionment,”’ as well as the ‘‘causation”’ issue. Defendants maintained that the amount of any award against them should be reduced by the shares of contribution to the harm of the plaintiffs and those who had settled with the plaintiffs. The defendants also maintained that the burden of apportionment was the plaintiffs’, not the defendants’, since the plaintiffs were also equally “responsible parties’’ under CERCLA. The district court rejected these arguments. It held that the only joint and several liability issue was whether “‘the harm at the Bluff Road site was divisible.’ It found that *‘[i]f the injury is indivisible, that should be the end of the inquiry.”’ Transcript of Proceeding before the Hon. Charles E. Simon, Jr., Jan. 13, 1984, at 83. Whether a defendant’s wastes were present at the site at the time of response was immaterial under the court’s theory, either to the issue of whether liability existed, or if existent, whether it should be joint and several. It was enough that wastes “‘like”’ the defendant's were there. Thus, despite the mistaken assumption of the court of appeals, 858 F.2d at 170-71, the district court never considered whether any of the generator defendants’ wastes were actually contained at the site at the time of cleanup. The lower court simply ruled that such evidence was irrelevant. Thus, the court granted partial summary judgment for plain- tiffs, holding that each generator defendant was jointly and severally liable for all costs under CERCLA § 107. It refused to consider the plaintiffs’ shares of responsibility for the harm remedied. requiring defendants to pursue that issue in a separate, subsequent action for contribution. It also did not reduce the judgment to reflect the plaintiffs’ settkements with other potentially responsible parties. App. D. After a later hearing on damages. the district court entered final judgment. App. D. The generator defendants appealed to the U.S. Court of Appeals for the Fourth Circuit. They argued that the lower court erred because CERCLA liability should be interpreted in light of common law princi- ples reflected in the Restatement (Second) of Torts, which (1) require a plaintiff to prove, for imposition of joint and several liability, that a defendant’s conduct was a substantial factor in producing the harm and (2) impose the burden of proof as to apportionment on the plaintiff, not the defendant, when the plaintiff has also contributed to the harm. Defendants also argued that the statute as so interpreted and applied to them was unconstitutional because: the court’s fashioning of CER- CLA liability criteria outside the scope of congressional guidelines violated separation of powers principles, and the Act as interpreted and applied to them violated constitutional constraints on retroactive and disproportionate sanctions and was also a bill of attainder. The landowners also appealed, raising issues not relevant to this petition. The Government appealed the lower court’s denial of prejudgment interest. Faced with the inconsistency of the arguments they had made below and the lower court’s decision, the governments, at the appellate level, shifted their position on two key legal issues. First, they agreed that defendants could avoid liability by proving that their wastes were not at the site when cleanup commenced. But they argued that the defendants had not tendered sufficient evidence on that point to avoid summary judgment. Second, the governments also accepted the posi- tion of Restatement (Second) of Torts § 433A that joint and several liability is inappropriate where **(a) there are distinct harms, or (b) there is a reasonable basis for determining the contribution of each cause to a single harm.”* In the court below the governments had argued that the ‘or’ should be read as if it were ‘“‘and,”’ and the lower court had accepted their argument. Again, however, the governments argued to the court of appeals that the defendants had not tendered sufficient evidence of a ‘‘reasonable basis for determining the contribution”’ to avoid summary judgment that they were jointly and severally liable. After the appeal had been argued, but while the decision was still pending, the Government settled with one of the appellants, Aquair Corporation. A two to one majority of the Fourth Circuit panel approved the settlement. but made no fairness review and did not reduce the amount of the district court judgment against the remaining defendants. App. C. Subsequently, the Fourth Circuit upheld the lower court’s imposition of strict, joint and several liability on the generator defendants and the landowners and remanded with instructions to the lower court to reconsider the question of prejudgment interest. App. B. It also rejected the generator defendants’ argument that where the plaintiff had also con- tributed to the harm, and was equally “‘innocent’’ or equally ‘*guilty as the defendant,”’ the plaintiff has the burden of proof as to apportionment. The court cited both Sections 433A and 433B of the Restatement as controlling. 858 F.2d at 172. But without explanation, the court ignored the clear intent of comment d to Section 433B that the burden is upon the plaintiff in such circumstances. Finally, the court observed that [w]e share the appellants’ concern that they not be ultimately responsible for reimbursing more than their just portion of the governments’ response costs. .. . Had we sat in place of the district court, we would have ruled as it did on the apportionment issue, but may well have retained the action to dispose of the contribution questions. ... That procedural course, however, was committed to the trial court’s discretion and we find no abuse of it. As we have stated, the defendants still have the right to sue responsible parties for contribution, and in that 10 action they may assert both legal and equitable theories of cost allocation. 858 F.2d at 173 (emphasis added). As to generator defendants’ constitutional arguments, the court declined to reach the separation of powers argument, stating that it had not been raised below. And while agreeing that CERCLA applied liability retroactively for constitutional purposes, the court rejected the bill of attainder and ex post facto arguments on the grounds that [t]he existence of joint and several liability in cases of indivisible harm does not transform an otherwise constitutional obligation into one that exacts pun- ishment. *‘Where there are oppertunities for contri- bution... as well as for joinder or impleader of responsible parties (Fed. R. Civ. P. Rules 14, 20 and 21). it can hardly be said that imposition of joint and several liability would be unconstitutional.’ Con- servation Chemical, 619 F. Supp. at 214-15. 858 F.2d at 175, n.33. The court did not address the defend- ants’ eighth amendment and due process “proportionality” arguments, apparently because it assumed that defendants through subsequent contribution suits could mitigate or av oid any grossly disproportionate incidence of CERCLA liability. Judge Widener dissented to upholding the lower court's dismissal of the generator defendants’ request for allocation based upon their equitable right to reduction of the judgment to reflect the plaintiffs’ contribution to the harm. He reasoned that a CERCLA cost recovery suit is an equitable action and that it is a universal and unvarying rule of equity that the court will decide all matters in dispute and decree complete relief. Moreover. he noted that CERCLA expressly provides that “fajny person may seek contribution from any other person who is liable or potentially liable under section 9607(a) of this title during or following any civil action under section 9606 of this title or under section 9607(a) of this title.” 858 F.2d at 177 (emphasis in original). He continued: [S]ince the matter was brought before the district court, that court had no discretion but to decide the question. To repeat. the discretion is in the party to make the claim, not in the district court to defer decision. While I agree that the claims may be asserted in a separate action, if they are asserted in the main case they must be decided. Id. (footnote omitted). He concluded: ““Not only do the statute and federal procedural law require the course I have suggested, I think the interests of justice as well as judicial economy are best served by proceeding in that manner.”* /d. On September 20, 1988, generator defendants filed a timely petition for rehearing and suggestion for rehearing in banc. They urged that in upholding the lower court's splitting of this single action for equitable restitution into two separate actions for liability and contribution, the majority opinion overlooked several important facts and law. Unless corrected, the result, could be an ultimate failure to obtain a meaningful apportionment of liability and thus needless and improper imposition on defendants of substantial, disproportionate lia- bility under CERCLA. Such needless and unfair results could be avoided, however, if the court reversed and remanded with instructions to (a) retain jurisdiction, (b) allocate liability and (c) reflect such allocation in the amount of the final judgment. On December 2, 1988, the court of appeals denied the suggestion for hearing en banc by a 5 to 4 vote. Judges Russell, Widener, Hall and Chapman voted to rehear the case: Judges Winter, Phillips, Murnaghan, Sprouse and Ervin voted against; and Judges Wilkinson and Wilkins disqualified them- selves. App. A. REASONS FOR GRANTING THE WRIT SUMMARY CERCLA is a complex, poorly drafted, statute that seeks to remedy a major, pressing social problem: the threat to public health and the environment posed by past disposal of hazardous wastes. Well over one hundred CERCLA cases are pending in district courts throughout the country. Most are long, drawn out affairs, involving many parties and complex issues of fact and law. Only a relatively few cases have reached the courts of appeals and have been decided there. This case is one of that small number. The basic approach as to CERCLA apportionment followed below is contrary to | > congressional intent and inconsistent with the approach fol- lowed by district courts in other circuits. Under long-standing equitable principles, the procedural question of mandatory bifurcation raised in this petition was erroneously decided below. It was also decided exactly op- posite to congressional intent, as clarified and confirmed in the 1986 Amendments to CERCLA. At the instance of the Gov- ernment, a divided Fourth Circuit panel carved vut an excep- tion to general equitable principles and the Federal Rules of Civil Procedure for CERCLA cases. If the exception is left standing, it will foster confusion in pending and future district court cases and present a serious obstacle to fair and reason- able settlement of multiple CERCLA claims. Moreover, the mandated “‘two actions” procedure sanc- tioned by the circuit court’s holding may result in the ultimate incidence of CERCLA liability on the petitioners, and many other CERCLA defendants in other similar cases, being far out of proportion to their equitable shares of CERCLA responsibility. By deferring consideration of allocation issues until after defendants have been required to reimburse plain- uff for all costs, defendants would suffer deprivation prior to the necessary statutory proportionality inquiry. Also if that ultimate incidence is many times a defendant's judicially allocated ‘‘fair share’’ of contribution to the harm, the result could be so disproportionate as to be punitive in effect. Thus, if this Court decides in Kelco Disposal, Inc. v. Browning- Ferris Industries of Vermont, Inc., 845 F.2d 404 (2d Cir. 1988), cert. granted, 109 S. Ct. 527 (1988), that the eighth amendment or due process clause imposes proportionality constraints on punitive damages, the end result of the proce- dure sanctioned by the court below could raise serious constitutional questions. Meanwhile, however, the judgment in this case will become final before the defendants’ fair shares of the allocated costs have been ultimately determined in the separate contribution action. Thus defendants could be denied a meaningful, timely forum to present their proof that the liability imposed upon them retroactively under CERCLA is so grossly disproportional as to be unconstitutional under the Constitution’s multiple constraints against retroactive punish- ment. The burden of proof issue raised in this petition is likewise straightforward and the answer equally clear. The court below, while correctly looking to the Restatement (Second) of Torts for the applicable federal common law rule as to joint and several liability under CERCLA, erroneously rejected without explanation the Restatement rule as to who has the burden of proof of apportionment where the plaintiff also contributed to the harm for which it seeks recovery. By reversing the long-standing common law rule, the court de- parted from the congressional guidelines. This violated this Court's recent admonitions, based on separation of powers principles, that the rights and remedies under federal common law are for Congress alone to pronounce and, thus, where the fact or extent of congressional innovation is significantly uncertain, the courts should resolve the uncertainty against change. Since many CERCLA plaintiffs, both governmental and private, are also “‘potentially responsible parties’’ under CERCLA, the question of who has this burden also arises at many sites. I. THE COMPULSORY TWO-ACTIONS ISSUE A. THE MAJORITY OPINION BELOW DISREGARDED EQUITABLE PRINCIPLES BY TREATING DEFENDANTS. EQUITABLE RIGHT TO REDUCTION OF THE AMOUNT RECOVERABLE BY THE PLAINTIFFS AS A COUNTER- CLAIM FOR CONTRIBUTION. A counterclaim is a cause of action in favor of the defendant on which he might have sued the plaintiff and obtained affirmative relief in a separate action. 80 C.J.S.., Set-Off and Counterclaim § 6 (1953) at 1S. A defense by way of recoupment is not the same as an affirmative cause of action. Basic Boats, Inc. v. United States, 311 F. Supp. 596, 598 (E.D. Va. 1970). The plaintiffs’ liability “‘is not a set-off or a counterclaim, but is an equitable reason”’ why they “‘ought not to recover’ all the damages from the defendants. Stone v. White, 301 U.S. 532, 538-39 (1937). As the plaintiffs, the governments framed this case. They presented only one set of claims—their own against the defendants. The district court took this single claim and carved out from the governments’ case the defendants’ partial defense based on the governments’ own shares of the harm [4 and required that the equitable reduction for their shares take place only by way of a separate, subsequent action. In other words, the district court’s action requires the defendants to satisfy the judgment in full and then bring a new, separate suit against the plaintiffs for contribution of their fair shares. This approach is diametrically opposite the correct anal- ysis of a defendant’s claim for reduction. In another recent CERCLA § 107 case, Mola Development Corp. v. United States, No. CV 82-0819-RMT(JRx), slip op. at 2 (C.D. Cal. May 6, 1986) (App. H), the court reasoned that the plaintiffs responsibility for damages must be litigated in the case in chief: (A] counterclaim for indemnity or contribution is illogical. For example, if A sues B, A has the burden of proving B’s liability and the amount thereof in A’s case in chief. B. in its defense, might show limitations on its liability or amount thereof. As a result, in the trial on A’s complaint against B, the relative responsibility for A’s loss will be litigated. It B counterclaimed against A for indemnity or contri- bution, B would be making a claim against A to shift to or share with A any loss B incurs as a result of A’s suit against B. However, any basis that could exist for B’s counterclaim must be litigated on A’s complaint and B’s defenses thereto. As a result, any shifting or sharing of the loss is liigated on A’s complaint and no basis exists for B’s counterclaim. (Emphasis added.) Thus, as the Mola Development court recognized, the plaintiffs responsibility vel non is an issue necessarily part of the case-in-chief. Accord United States v. Hardage, 26 Env't Rep. Cas. (BNA) 1049, 1052 (W.D. Okla. 1987). All agree that CERCLA cost recovery and contribution actions sound in equity. But equity “‘does not countenance the idle ceremony” of the district court’s procedural course. Stone v. White, 301 U.S. 532, 537 (1937). To avoid circuity, the courts below should have taken cognizance of the tdentity in interest of the EPA and the other liable agencies of the Federal Government. But they did not. Yet this Court has long recognized in parallel equitable actions that the Govern- 15 ment is a unitary entity and its agencies collectively and singularly are the United States Government. E.g., Stone v. White, 301 U.S. at 537; Pavne v. Hook, 74 U.S. 425 (1869): see also United States v. Shell, 605 F. Supp. 1064, 1082 (D. Colo., 1985), (*The United States argues that it and the Department of the Army are one and the same entity as a matter of law.’’), id. at 1083 (“The case is not unlike a common comparative negligence case where a defendant asserts that the injured plaintiff's conduct caused some or all of his own injury. Procedurally, the plaintiff is not joined as a defendant; rather the court apportions responsibility for the damages.’’) The majority opinion below overiooked these traditional equitable principles. which treat reduction of the judgment according to the plaintiff's share of responsibility as a defense, not a separate claim. Stone v. White, 301 U.S. at 539. B. THE MAJORITY OPINION BELOW FAILED TO CON- SIDER THE GOVERNING FEDERAL PROCEDURAL LAW AND THE FACT THAT THE LOWER COURT DID NOT MAKE THE EXPRESS DETERMINATION UNDER RULI 54(b) REQUIRED FOR A BIFURCATED DECISION. IN- STEAD, IT CREATED A DE FACTO EXCEPTION TO THI FEDERAL RULES oF Civit PRoceEpURE FOR CERCLA CASES. In sanctioning the mandatory bifurcation of this action, the majority opinion also ignored the clear language of the governing statutory law. First, although the majority opinion quotes the language of CERCLA § 113((1) in footnote 13, it overlooks that section’s command that *‘[s]uch claims shall be brought in accordance with . . . the Federal Rules of Civil Procedure, and shall be governed by Federal law.”’ 42 U.S.C. » 9613(f(1)(Supp. IV 1986) (emphasis added). The legislative history of this language emphasizes that courts are to resolve claims for allocation ‘‘on a case-by-case basis, taking relevant equitable considerations into account.’ H.R. Rep. No. 253, 99th Cong., Ist Sess., pt. 3 at 19 (1985), reprinted in 1986 U.S. Code Cong. & Ad. News 3042. The defendants’ equitable defense was an issue in the case-in-chief and thus had to be heard before entry of final judgment. But even if defendants’ equitable defense were a 16 ‘““claim’’ within the contemplation of Section 113(H(1), then defendants’ claim was a compulsory counterclaim in the nature of recoupment. United States v. Mottolo, 605 F. Supp. 898. 910-11 (D. N.H. 1985). Accord United States v. Moore, 28 Env't Rep. Cas (BNA) 1150, 1152 CE.D. Va. 1988); United States Vv. Nicolet, Inc.. No. 85-3060, slip Op. (E.D. Pa. Dec. 31. 1986) (available on Lexis. Genfed Library Dist file). Thus CERCLA. which expressly incorporates the Federal Rules of Civil Procedure, requires that this “‘claim’’ must be asserted in plaintiff's case rather than in a separate action. CERCLA § 113(f)(1): Fed. R. Civ. P. 13(a). Although cross-claims and third-party actions may be accelerated or deferred at a defendant's option, under Fed. R. Civ. P. 13(a) compulsory counterclaims may not be deferred except in instances not material here. While the trial court may bifurcate its decision of issues of liability and allocation into separate phases of the same proceeding, it may not sever them and render final judgment on the former unless it makes the express determination required by Rule 54(b) “that there is no just reason for delay.”’ The district court made no such determination here. The decisions below permit the governments to ignore the Federal Rules and to defer. and perhaps avoid, their own equitable obligations. This is contrary to both equitable prin- ciples and CERCLA § 113(f), which was added by the 1986 amendments to “‘ratify’’ existing law. See H.R. Rep. No. 253, 99th Cong., Ist Sess.. Pt. 3 at 18 (1985), reprinted in 1986 U.S. Code Cong. & Admin. News 3041: 131 Cong. Rec. S11,857 (daily ed. Sept. 20, 1985) (Statement of Sen. Thurmond). In the course of the 1986 Amendments, EPA sought an amendment to compel the bifurcation of determinations of liability and contribution into two separate actions. EPA was initially successful in the Senate. S. 51. as reported by the Senate Environment and Public Works Committee, contained an amendment that would have precluded defendants sued under CERCLA §& 107 from bringing claims for contribution until after a judgment had been entered or a settlement was reached. S. 51, 99th Cong., Ist Sess., at § 126: S. Hrng. 60, Superfund Improvement Act of 1985, Hearings on S. 51 and S. 494 before the Senate Committee on Environment and Public Works. 99th Cong. Ist Sess., 104-105 (Feb. 25, 1985); S. Rep. ee No. Il, 99th Corg., Ist Sess., 44-45 (March 18, 1985). Subsequently, however, the Senate rejected this amendment after several senators objected to it. See S. Hrng. 61, /nsur- ance Issues and Superfund, Hearing before the Senate Com- mittee on Environment and Public Works, 99th Cong., Ist Sess., 21-22 (April 3, 1985) (Senator Mitchell); S. Hrng. 415, Superfund Improvement Act of 1985, Hearing on S. 51 before the Senate Committee on the Judiciary, 99th Cong., Ist Sess., 77-78 (June 7, 1985) (Senator Simpson); id. at 91 (Senator Hatch); id. at 99-101 (Senator Specter). In supporting the Judiciary Committee’s substitute amendment on the floor, Senator Thurmond said: One issue addressed by these amendments ts the right to contribution; that is, the right of one defend- ant to pursue reimbursement from codefendants. All of the expert witnesses appearing before the committee agreed that the right to contribution should be codified in order to encourage responsible parties to engage in cleanup and settlement. The committee proposal would codify that right and, retaining current law, would allow a judge the discretion and flexibility to best manage the contri- bution issues in a law suit. 131 Cong. Rec. S11,857 (daily ed. Sept. 20, 1985) (emphasis added). In the bill passed by the Senate the provision reported by the Environment and Public Works Committee was deleted and the substitute sponsored by members of the Judiciary Committee adopted. This is the current CERCLA § 113(f)(1). C. BECAUSE IT PROVIDES NO MECHANISM FOR AD- JUSTING SETTLEMENT AMOUNTS, THE RULING BE- LOW MAY RESULT IN DEFENDANTS ULTIMATELY BEING LIABLE FOR SUBSTANTIALLY MORE THAN THEIR JUST PORTION OF RESPONSE COSTS AND AF- FORD THE PLAINTIFFS DOUBLE RECOVERY. THIS COULD POSE MAJOR CONSTITUTIONAL PROBLEMS. The majority opinion be' .w recognized generator detend- ants’ legitimate ‘““concern th. they not be ultimately respon- sible for reimbursing more than their just portion of the governments’ response costs.”’ 858 F.2d 173. The majority 18 was mistaken, however. in assuming that through a separate action for contribution generator defendants ultimately would be able to prevent that inequity. To the contrary. by upholding the district court’s mandated separation of the liability and allocation issues into two separate actions, the majority substantially increased the likelihood that defendants will never be able to obtain sufficient contribution to avoid this disparate result. As to claims against the governments, the majority below stated reassuringly that “‘any further claims against the EPA and other responsible government instrumentalities may be resolved in a contribution action pursuant to CERCLA sec- tion 113(f).”’ 858 F.2d 173, n.28. But as to the claims against the nongovernmental settling defendants, who obviously will bear a major portion of contribution to the harm once an allocation is made, the court of appeals expressly refused to determine the effect of such settlements on defendants’ rigiscs to contribution againsi them. saying it was premature. 858 F.2d 173, 0.29. Thus. the course required by the district court, and upheld by the majority below, appears to be a final judgment against the generator defendants for all the costs with no procedure available for mitigation by future contribution based on the settling nongovernmental parties’ allocated responsibility for the harm. This result obtains because the contribution protection component of CERCLA § I13(f)(2) expressly provides that the effect of releases is to discharge the settling party from contribution claims. The only real question left unanswered by the court of appeals for resolu- tion in the separate contribution action is whether the gener- ator defendants can recover the settlors’ allocated shares back from the governments. Moreover, even the court’s assumption that the defend- ants can obtain any contribution from the State of South Carolina in a subsequent, separate action may prove errone- ous. The issues of whether Congress in CERCLA has waived. or constitutionality can waive, a state’s immunity to contri- bution suits by private parties is currently pending before the Court in Pennsylvania v. Union Gas Company, 832 F.2d 1343 (3rd Cir. 1987). cert. granted. 108 S. Ct. 1219 (1988). argued. Oct. 31. 1988. If this Court holds that such immunity has not 19 or could not be waived, then defendants will ultimately be forced to bear South Carolina’s share. That unfair result would be precluded, however, had the lower court retained jurisdiction. By joining in the suit here, South Carolina waived its sovereign immunity to valid defenses such as recoupment and setoff. Thus, the district court could have subsequently reduced the amount of the judgment in favor of South Caro- lina as plaintiff by South Carolina’s fair share as waste contributor. See United States v. Mottolo, 605 F. Supp. 898, 910-11 (D. N.H. 1985). In any event, since the judgment here will have already become final without having been reduced by amounts paid in settlement, there appears to be no procedural mechanism available for giving effect to the second command of CER- CLA § 113(f)(2). That command is that a settlement ‘reduces the potential liability of the others by the amount of the settlement.”’ 42 U.S.C. § 9613(f)(2) (Supp. IV 1986). If no such procedural mechanism for partially adjusting the ‘‘final judgment” exists, the substantive result would be contrary to established principles of common law and equity. Federal Savings & Loan Insurance Corp. v. Reeves, 816 F.2d 130, 137 (4th Cir. 1987) (under federal common law, partial satisfaction reduces the total for which the remaining defendants are responsible): United States v. Northeastern Pharmaceutical & Chemical Co., 810 F.2d 726, 748-49 (8th Cir. 1986) cert denied, 108 S. Ct. 146 (1987); Uniform Comparative Fault Act » 6, 12 U.L.A. Civil Proc. & Rem. Laws 50 (Supp. 1988): Restatement (Second) of Torts § 885(c) (1982). This fear is not an idle one. The district court and the Fourth Circuit majority approved settlements with other parties in this case without reducing the amount of the judgment against generator defendants. The district court entered a settlement between the United States and one defendant. United States v. South Carolina Recycling & Disposal, Inc., 653 F. Supp. 984, 1010 (D. S.C. 1985) (App. F). But in its final judgment, the district court did not reduce the judgment against the generator defendants in accordance with this settlement. Likewise, after argument of this appeal. the governments settied with one of the appellants, and the Fourth Circuit pane! approved the settlement without a hear- ing Gespite Judge Widener’s dissent. (App. B). The subse- 20 quent majority opinion on the merits of the appeal neither reduced the judgment against the remaining appellants nor addressed the effect of this settlement. Yet the law requires that the effects of settlement on the liability of nonsettling joint tortfeasors be addressed. See Ratner v. Sioux Natural Gas Corp., 719 F.2d 801, 803 (Sth Cir. 1983), appeal after remand, 770 F.2d 512 (1985). See also United States v. Moore, 28 Env’t Rep. Cas. (BNA) 1152 (E.D. Va. 1988). The entry of these settlements without such an inquiry is contrary to CERCLA, as well as the equitable principles cited in Judge Widener’s dissent. In addition, the failure to reduce the amount of the final judgment against generator defendants permits the plaintiffs to obtain double recoveries. That is also contrary to equitable principles and the congressional policy reflected in CERCLA § 114(b). Several district courts in other circuits have had occasion to determine what should be the “federal common law’’ as to the effect of a settlement with one responsible party under CERCLA on the liability of the remaining responsible parties in the context of a suit for contribution. In Lyncott Corp. v. Chemical Waste Management, Inc., 690 F. Supp. 1409, 1418 (E.D. Pa. 1988), the court determined the principles of the Uniform Comparative Fault Act (**U.C.F.A.”’) are most consistent with CERCLA because [it] expressly provides for the application of com- parative fault in actions based upon strict liability. _.. In addition, the U.C.F.A. avoids the inequity that might develop were non-settlers forced to ab- sorb the total cost of shares of responsibility that are not allocable to solvent responsible parties. . . . [I]t also solves the problem of settlements involving non-monetary consideration. (Citations omitted.) Under Section 6 of the U.C.F.A. the effect of release is that ‘the claim of the releasing person against other persons is reduced by the amount of the released person's equitable share of the obligation. . . ..’ The court accordingly held in a declaratory judgment action that a settlement between a CERCLA plaintiff and a CERCLA defendant relieved that defendant from CERCLA liability and gave it protection from contribution. Thus, that defendant's “equitable shares of the response costs, if any, must be tr attributed to plaintiff in the CERCLA litigation.’ 690 F. Supp. at 1418. Accord Edward Hines Lumber Co. v. Vulcan Mate- rials Co., No. 85 C 1142, slip op. at 3. reprinted in Haz. V/aste Lit. Rep. (Andrews) 12,055, 12.056 (N.D. Ill. 1987) (also available on LEXIS, Genfed library, Dist file) (holding that the ‘comparative fault rule’’ applies to CERCLA settlements and it ‘‘allows the non-settling defendant to offset its liability to the plaintiff by an amount proportionate to the settling defendant’s responsibility’’); see also City of New York vy. Exxon Corporation, 697 F. Supp. 677 (S.D. N.Y., 1988) (available on LEXIS, Genfed library. Dist file) (‘Under alternative contribution frameworks, the City’s recovery against the remaining defendants would likely be reduced at least by the settling parties proportionate share of the fault if it turns out to be greater than the settlement amount.”’). Had the Fourth Circuit required the district court to retain jurisdiction and thus control over the amount of the judgment against the defendants, then once the equitable shares of the settlors had been determined in the remanded proceedings, the district court could have reduced the amount of the judgment accordingly. The only other way to attain the same result under the “‘two-actions’’ procedure mandated here would be to enter an award for the defendants against the governments in the contribution suit in an amount reflecting the governments’ and the settling defendants’ shares, plus interest for the period between the two separate judgments. Unless that takes place, the two-separate-actions procedure will ultimately result in generator defendants being unfairly saddled with more of the costs than would have been imposed on them if the lower court had decided the allocation issue in a single equitable proceeding. The Court recently granted certiorari in Kelco Disposal Inc. v. Browning-Ferris Industries of Vermont, Inc., 845 F.2d 404 (2d Cir. 1988), cert. granted, 109 S. Ct. 527 (1988). There one of the issues is whether punitive damages ‘amounting to more than 100 times the plaintiff's actual damages from [a] purely economic tort is excessive under the Eighth Amend- ment or otherwise.”’ 57 U.S.L.W. 3390 (Dec. 6, 1988). It is possible that the Court may decide that proportionality con- straints do exist under either an eighth amendment or a due process rationale. If so, then one such constraint in punitive PT? a damages cases involving purely economic injuries may be that they cannot exceed a reasonable multiple of actual damages. Thus, if the Constitution imposes proportionality constraints on the amount of property that can be taken as punishment for tortious or criminal conduct, surely there must be at least equivalent limitations on how much property can be taken for ‘innocent’? (non-tortious and non-criminal) conduct. Put an- other way, in specific factual contexts if the ultimate incidence of CERCLA liability is many times a defendant's fairly apportioned share, liability could be so grossly disproportion- ate as to be punitive in effect under a United States v. Ward, 448 U.S. 242, 248-49 (1980), and Kennedy v. Mendoza- Martinez, 372 U.S. 144 (1963), type analysis. There must be a point at which the nexus of a particular defendant with the harm remedied becomes so attentuated that ‘‘restitution”’ could no longer be said to be ‘‘equitable’’ and thus becomes ‘*exaction.’’ Where such disproportionate liability is imposed retroactively, it could hardly be said to have a “‘rational basis’’ or to be ‘“‘reasonable regulation.”” See Bowen v. Georgetown University Hospital, __ U.S. __ , 109 S.Ct. 468, 475, 479 (1988) (Scalia, J., concurring). Moreover, if the imposition of liability becomes so dis- proportionate as to be punitive in effect, it also violates multiple constitutional constraints on retroactive and dispro- portionate punishment. F.g., Solem v. Helm, 463 U.S. 277 (1983); McCleskey v. Kemp, 481 U.S. 279, 315 (1987) (‘The Eighth Amendment is not limited to capital punishment, but applies to all penalties.”’); Weaver v. Graham, 450 U.S. 24, 28-31 (1981); Vuitton v. Spencer Handbags Corp., 765 F.2d 966, 972 (2nd Cir. 1985); See also Freeman, Justice Powell's Constitutional Opinions, 45 Wash. & Lee L. Rev. 411, 443-446 (1988); Freeman, /nappropriate and Unconstitutional Retroactive Application of Superfund Liability, 42 Bus. Law 215 (1986); Jeffries, A Comment on the Constitutionality of Punitive Damages, 72 Va. L. Rev. 139 (1986). Also, if a CERCLA plaintiff is given discretion to shift a disproportional share of CERCLA liability to a defendant selected by him through a manipulative strategy of settle- ments, bifurcated, separate actions and shifts in the common law burden of proof, the potential for discrimination in the absence of constraining guidelines raises substantial due pro- 23 cess and equal protection questions. CERCLA damages could be imposed “in wholly unpredictable amounts bearing no necessary relation to the actual harm caused.’ Gertz v. Welch, 418 U.S. 323, 350 (1974). See also Bankers Life & Casualty Co. v. Crenshaw, __ U.S. _ , 108 S.Ct. 1645, 1655-56 (1988) (O’Connor, J., concurring); (The ‘‘wholly standardless discretion to determine the severity of punish- ment appears inconsistent with due process.”’); Eddings v. Oklahoma, 455 U.S. 104, 111 (1982); A. B. Small Co. v. American Sugar Refining Co., 267 U.S. 233, 239 (1925) (The defendant attempts to distinguish those cases [United States Vv. Cohen Grocery Co., 255 U.S. 81 and Weeds Inc. v. United States, 255 U.S. 109] because they were criminal prosecu- tions. But that is not an adequate distinction. The ground or principle of the decisions was not such as to be applicable oniy to criminal prosecutions. It was not the criminal penalty that was held invalid, but the exaction of obedience to a rule or standard which was so vague and indefinite as really to be no rule or standard at all. Any other means of exaction . . . was equally within the principle of those cases. They have been so construed and applied by other courts in civil proceedings.’’) (citations omitted.) Both the Fourth Circuit below, and the Conservation Chemical court which it quoted, implicitly recognized that if the ultimate incidence of CERCLA liability were unlimited, serious constitutional problems would be presented: The existence of joint and several liability in cases of indivisible harm does not transform an otherwise constitutional obligation into one that exacts pun- ishment. *‘Where there are opportunities for contri- bution . . . as well as for joinder or impleader of responsible parties (Fed. R. Civ. P. Rules 14, 20 and 21), it can hardly be said that imposition of joint and several liability would be unconstitutional.’* Con- servation Chemical, 619 F. Supp. at 214-15. 858 F.2d at 175, n.33. But because it assumed that the defendants would be able to avoid grossly disproportionate liability through a subse- quent suit for contribution, the Fourth Circuit did not address the eighth amendment and due process arguments based on 24 the combined effects of disproportionality and retroactivity. It also used that optimistic assumption to reject generator de- fendants’ ex post facto and attainder arguments. But from hindsight. the court’s assumption may prove false. To fore- stall such a consequence. the statutory allocation of CERCLA liability should precede the entry of final judgment in this CERCLA § 107 suit. The procedural problems posed here are by no means confined to this particular case. Since the Fourth Circuit is the first circuit court of appeals to speak to these issues, the precedents may spread to other circuits as the Government seeks to obtain from the courts what Congress denied it in the 1986 CERCLA Amendments. Moreover, the two-separate- actions approach upheld by the Fourth Circuit is inconsistent with the approaches taken by district courts in the First, Second, Third. Seventh, Ninth and Tenth Circuits in the Mottolo, Exxon, Lyncott, Mola, Hines Lumber, Hardage and Shell cases cited above and thus portends a serious impending split among the circuits. Il. THE BURDEN OF PROOF ISSUE Phe court below stated that the Restatement (Second) of Torts represents “‘the correct and uniform federal rules appli- cable to CERCLA cases.” 858 F.2d at 172. But that court ignored the statements in the Restatement as to who has the burden of proof. Comment g to Section 433A states that **[a]s to the burden of proof. and the effect of failure to produce evidence justifying the apportionment, see § 433B.°° Subsec- tion 2 of Section 433B lays down a general rule that iwlihere the tortious conduct of two or more actors has combined to bring out the harm to the plaintiff, and one or more of the actors seeks to limit his liability on the ground that the harm is capable of apportionment among them, the burden of proof as to the apportionment is upon each such actor. But comment d makes it clear that shifting the burden to the defendant under this rule is predicated upon his being in a class different from the plaintiff. Comment d explains that (tlhe reason tor the exceptional rule placing the burden of proof as to apportionment upon the defendant or defendants is the injustice of allowing a proved wrongdoer who has in fact caused harm to the plaintiff to escape liability merely because the harm which he has inflicted has combined with similar harm inflicted by other wrongdoers,. and the nature of the harm itself has made it necessary that evidence be produced before it can be apportioned. In such a case, the defendant may justly be required to assume the burden of producing that evidence, or if he is not able to do so, of bearing the full responsibility. As between the proved tortfeasor who has clearly caused some harm, and the entirely innocent plaintiff, any hardship due to lack of evidence as to the extent of the harm caused should fail upon the former. (Emphasis added.) Here the plaintiffs, the Government and South Carolina, were in the same class as the generator defendants—all had contracted with the same transporters for disposal of their hazardous wastes. Under their own theory of the case, which the court of appeals adopted, the governments and the gen- erator defendants had all contributed to the harm. Moreover, the plaintiffs offered no proof as to any differences in the qualitative conduct or the wastes of the generator defendants and their own agencies that would avoid this shift of the burden of proof back to the plaintiffs under the logic of comment d. Thus, under no circumstances could the govern- ments be characterized as “‘entirely innocent plaintiff]s]”° as compared to the defendants within the contemplation of comment d. For that reason, the governments could not avail themselves of the Subsection (2) exception and were instead subject to the general rule of Section 433B that: (1) Except as stated in Subsections (2) and (3), the burden of proof that the tortious conduct of the defendant has caused the harm to the plaintiff is upon the plaintiff. Additionally, Restatement comment e on Section 433B (2) sounds a caveat that would be applicable to the situation here even if the plaintiffs were not within the same class of 26 responsible parties as the generator defendants and thus were ‘entirely innocent’’ as contemplated in comment d. Comment e states: The cases thus far decided in which the rule stated in Subsection (2) has been applied all have involved a small number of tortfeasors, such as two or three. The possibility arises that there may be so large a number of actors, each of whom contribute a rela- tively small and insignificant part to the total harm, that the application of the rule may cause dispro- portionate hardship to defendants. Thus if a hun- dred factories each contribute a small, but. still uncertain, amount of poilution to a stream, to hold each of them liable for the entire damage because he cannot show the amount of his contribution may perhaps be unjust. Such cases have not arisen, possibly because in such cases some evidence lim- iting the liability always has been in fact available. This comment on when the burden of proof should shift ts based upon what is fair in light of the relative conduct of the parties and their potential access to the facts necessary for apportionment. Usually, where the wastes of multiple gener- ators are involved, the Government will, because of its broad investigative powers and its resources, be in a better position to marshall the facts relative to apportionment. That clearly was the case here where the Government identified a large list of all who had dealt with the waste transporters, marshalled the facts as to volumes of waste disposed of by each and, indeed, settled with a substantial number of generators on a volumetric apportionment basis. The court of appeals acknowledged the applicability of Section 433B to CERCLA actions but then failed to apply ii. It inexplicably gave no reason for accepting Section 433A and rejecting the generator defendants’ arguments on the applica- bility of Section 433B. Its failure to follow Section 433B, by reversing the burden of proof on the apportionment Issue, compounds the problems for petitioners posed by the court's other procedural error in upholding the lower court’s manda- tory bifurcation of the liability and allocation issues into two separate suits. Congress in CERCLA did not spell out the criteria for when and under what circumstances joint and several liability could be imposed under CERCLA. In the absence of statutory guidance, most courts have turned to its legislative history and fastened on to the statement of one of the principal sponsors of the Senate compromise bill that became the law that the applicability of joint and several liability was to be governed by “‘traditional and evolving principles of common law.’ 126 Cong. Rec. 30932 (1980) (statement of Sen. Ran- dolph). Many courts, like the court of appeals below, have looked to the Restatement (Second) of Torts for the applicable common law principles. The court of appeals’ unexplained rejection of those principles as reflected in Section 433A and B’s rule as to the burden of proof departs from the Congressional guidance. This freewheeling judicial creation of federal substantive and procedural law is counter to the teaching of a number of recent decisions of this Court. See, e.g., California v. Sierra Club, 451 U.S. 287 (1981): Middlesex County Sewerage Authority v.. National Sea Clammers Ass'n, 453 U.S. 1 (1981); Texas Industries v. Radcliff Materials, Inc., 451 U.S. 630 (1981); Universities Research Assoc., Inc. v. Coutu, 450 U.S. 754 (1981); Touche Ross & Co. v. Redington, 442 U.S. $60, 568 (1979): Transamerica Mortgage Advisors, Inc. v. Lewis, 444 U.S. 11 (1979). These opinions are not **constitu- tional;”’ they concern policies of statutory construction and judicial decisionmaking. Yet those policies are grounded in the constitutional structure of separation of powers. They call for an approach to statutory construction that curtails open- ended legislative delegations and avoids unguided judicial resolution of important questions of public policy. They teach that where the fact or extent of congressional innovation is significantly uncertain, the courts should resolve the uncer- tainty against change. Here the departure from separation of powers principles was much greater than the situations dis- cussed in the above cases. The Restatement is clear and unambiguous on the burden of proof issue and it undoubtedly embodies *‘the common law.”* Thus the court below was not acting in the face of a *‘vacuum”™ or ‘‘gap’’ and forced to create “interstitial law.” It simply ignored the common law 28 and, at the instance of the plaintiffs. substituted its own notion as to what the law ought to be. In other contexts, the Government has sharply criticized attempts to underniine traditional common law constraints on the applicability of joint and several liability by shifting the burden of proof. A recent Justice Department report specifically noted that in the past decade there has been a veritable explosion of tort liability in the United States . . . . [One of its principal causes has been] [t]he undermining of cau- sation through a variety of questionable practices and doctrines which shift liability to ““deep pocket” de- fendants even though they did not cause the underly- ing injury or had only a limited or tangential involve- ment. United States Department of Justice, Report of the Tort Policy Working Group on the Causes, Extent and Policy Implications of the Current Crisis in Insurance Availability and Affordability, at 2. (February, 1986) The Report went on to say that one means that has been used to undermine causation— increasingly common in toxic torts cases—is the use of presumptions or burden-shifting techniques to force the defendant to prove the lack of causation in order to avoid liability. Frequently, this amounts to asking the defendant to meet an impossible burden of proving the negative. Id. at 34-35. Since the Government is perhaps the largest waste genera- tor in the country and its wastes are present at many CERCLA sites. this question of who has the burden of proof is pertinent in many CERCLA cases. Moreover, many other CERCLA plain- tiffs beside the Government have also contributed to the harm or threat of harm at sites they have cleaned up and for which they in turn seek cost recovery under CERCLA § 107(a). This Court's reaffirmation of the Restatement’s common law rule as to who has the burden of proof in determining whether joint and several liability is appropriate is needed to put the CERCLA liability regime back within the congressional guidelines. Such a decision would also reinforce this Court's recent admonitions to the lower federal courts to avoid free wheeling. unguided, creation of federal nghts and remedies. CONCLUSION ; ¢ 7 1 1e« _ ‘ ’ ° ; , ++ . ‘ ire tix it) and LIMOLALIOT SSuc ! ) v\ CDad C I(CLIONS Was GIFeCHY t ' t YY ' r) rf _ act ¢ T COMUFary tO Congre Oona USO Inconsistent with +} ho Male } tc | ke ¢ | 4 , ‘ Tt ' , © ft | ™. , l bif iSIC Ap} WALT! \ IN \ Wea \ SSUC aAKCTI If] AC j T tact . j tr ¢ ot , ‘ ‘ t , ref } est Cases DY CIS < ~OU Cas XN OPI CITCUITS Lilt ’ ' Le, * " t t} b a | ' t+ ow . t ¢ ' DOSILION aKeCI ClOy\V is () C Iird () Nroo \ QO appo ti YmNent \ C ntrar tr) mr ' 1 ' in rn a Onmen Wa CO il \ | ) Ww LIPICS ahha I r) aL nt it? Tr YT 7; for I} . mo { { iv 4 SIsSten vV V mIiVUSSI i Ui — 4 i I i mAbILIL UE \& \ tint t +, ' m rr ' } tt yiirt { rr , if i Ml OL 1©Qe 16 LU \ COU \) PPC ) ( tr C int r nt r rr t ‘ ; ‘ | 4 ( Uu ‘ = ~ P/L . " ' ] , . , { , , O adhere to separatio Tt pe bernan r bor tant ; . ‘ ( CSLION i ‘ i ) y . ) f ¢h ‘ , b. ty Because ¢ KE! \ " r dur . n +} ) ¢ , { } , } } Ll ik. il \ = i r ‘ sod ir their rr ¢ . ] j fie ‘ VUIVCU Til UIC! i})} i fis , yr ' " ma ¢ r b +} ‘ ’ VIOCCUUlLAd UuUC ) ‘ yurts the time ' , \f { ‘ I C i Cly RU LLiV ’ I r ff \¢ Sees Cal void tf 11TT | Til > ? | tT? r i r ’ ’ CouId OUNer\ ¢ | ) ‘ . ‘ CERCLA , tal , lhis page intentionally left blank APPENDICES APPENDIX A UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT FILED DEC 2? 1988 LS. Courts of Appeals Fourth Circuit No. 86-1261(L) No. 86-1263 No. 86-1265 United States of America, et al. ippellees versus Monsanto Company, et al.., Appellants, and South Carolina Recycling and Disposal, Inc., et al., Defendants. On Petition for Rehearing with Suggestion for Rehearing In Banc. The appellants’ petitions for rehearing and suggestions for rehearing in banc were submitted to this Court. In a requested poll of the Court on the suggestions for rehearing in banc, Judges Russell, Widener, Hall and Chap- man voted to rehear the case in banc; and Chief Judge Winter and Judges Phillips, Murnaghan, Sprouse and Ervin voted against in banc rehearing. Judge Wilkinson and Judge Wilkins disqualified themselves from voting. As the panel considered the petitions for rehearing and a majority is of the opinion that they should be denied, and as a majority of the active circuit judges participating voted to deny rehearing in banc: A-2 IT IS ADJUDGED AND ORDERED that the petitions for rehearing and suggestions for rehearing in banc are denied. Entered at the direction of Judge Sprouse for a panel consisting of Judge Widener, Judge Sprouse and Judge Ervin. For the Court. s/ JOHN M. GREACEN APPENDIX B UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 86-1261 UNITED STATES OF AMERICA; SOUTH CAROLINA DEPARTMENT OF HEALTH AND ENVIRONMENTAL CONTROL Plaintiffs-Appellees Vv. MONSANTO COMPANY: ALLIED CORPORATION: E. M. INDUSTRIES, INC.: Defendants-Appellants AMERICAN INSURANCE ASSOCIATION: CHEMICAL MANUFACTURERS ASSOCIATION Amict Curiae and SOUTH CAROLINA RECYCLING AND DISPOSAL, INC.: COLUMBIA ORGANIC CHEMICAL COMPANY: OSCAR SEIDENBERG: HARVEY HUTCHINSON: EATON CORPORATION: RAD SERVICES, IN€.: AQUAIR CORPORATION: Defendants V. G. D. SEARLE & COMPANY: WILL ROSS, INC. Third Party Defendants B-2 No. 86-1263 UNITED STATES OF AMERICA; SOUTH CAROLINA DEPARTMENT OF HEALTH AND ENVIRONMENTAL CONTROL Plaintiffs-Appellees ° OSCAR SEIDENBERG: HARVEY HUTCHINSON; Defendants-Appellants AMERICAN INSURANCE ASSOCIATION; CHEMICAL MANUFACTURERS ASSOCIATION Amici Curiae and MONSANTO COMPANY: ALLIED CORPORATION; AQUAIR CORPORATION: E. M. INDUSTRIES. INC.: SOUTH CAROLINA RECYCLING AND DISPOSAL, INC.: COLUMBIA ORGANIC CHEMICAL COMPANY: EATON CORPORATION; RAD SERVICES, INC. Defendants V. G. D. SEARLE & COMPANY: WILL ROSS, INC. Third Party Defendants B-3 No. 86-1265 UNITED STATES OF AMERICA Plaintiff-Appellant and SOUTH CAROLINA DEPARTMENT OF HEALTH AND ENVIRONMENTAL CONTROL Plaintiff v. MONSANTO COMPANY: ALLIED CORPORATION: E. M. INDUSTRIES, INC... SOUTH CAROLINA RECYCLING AND DISPOSAL, INC.: OSCAR SEIDENBERG: HARVEY HUTCHINSON: 2 Defendants-Appellees AMERICAN INSURANCE CORPORATION: CHEMICAL MANUFACTURERS ASSOCIATION Amict Curiae and COLUMBIA ORGANIC CHEMICAL COMPANY: EATON CORPORATION: RAD SERVICES, INC.:; AQUAIR CORPORATION Defendants vi G. D. SEARLE & COMPANY: WILL ROSS, INC. Third Party Defendants B-4 Appeal from the United States District Court for the District of South Carolina, at Columbia. Charles E. Simons, Jr., Sen- ior United States District Judge. (CA-80-1274-6). Argued: October 8, 1987 Decided: September 7, 1988 Before WIDENER,. SPROUSE, and ERVIN. Circuit Judges. George Clemon Freeman, Jr. (William F. Kennedy; Alfred R. Light; Thomas E. Knauer: Hunton & Williams on brief): Isadore S. Bernstein (Hammer & Bernstein on brief) for Appellants: David Carlisle Shilton, Department of Justice (F. Henry Habicht, Il, Assistant Attorney General: Myles E. Flint, Deputy Assistant Attorney General: Vinton D. Lide, United States Attorney; Mary G. Slocum, Assistant United States Attorney: Jacques B. Gelin, Department of Justice: Walton J. McLeod, III, General Counsei, South Carolina Department of Health & Environmental Control: Charles De Saillan: Dov Weitman, Environmental Protection Agency on brief) for Apdellees: (Edward W. Warren: David G. Norell: Amy R. Sabrin; Kirkland & Ellis; David F. Zoll, Barbara A. Hindin on brief) for Amicus Curiae Chemical Manufacturers Association: (Thomas W. Brunner: Laura A. Foggan; Piper & Marbury on brief) for Amicus Curiae American Insurance Association. SPROUSE. Circuit Judge: Oscar Seidenberg and Harvey Hutchinson (the site- owners) and Allied Corporation, Monsanto Company, and EM Industries, Inc. (the generator defendants),'! appeal from the district court’s entry of summary judgment holding them liable to the United States and the State of South Carolina (the governments) under section 107(a) of the Comprehensive ‘Originally a named generator defendant in this case, Aquair Corporation has entered into a settlement agreement with the plaintiffs. B-5 Environmental Response, Compensation, and Liability Act of 1980 (CERCLA). 42 U.S.C.A. § 9607(a) (West Supp. 1987). The court determined that the defendants were liable jointly and severally for $1,813,624 in response costs accrued from the partial removal of hazardous waste from a disposal facility located near Columbia, South Carolina. The court declined, however, to assess prejudgment interest against the defend- ants. We affirm the district court's liability holdings, but we vacate and remand for reconsideration its denial of prejudg- ment interest. i. In 1972, Seidenberg and Hutchinson leased a four-acre tract of land they owned to the Columbia Organic Chemical Company (COCC), a South Carolina chemical manufacturing corporation. The property, located along Bluff Road near Columbia, South Carolina, consisted of a small warehouse and surrounding areas. The lease was verbal, on a month-to- month basis, and according to the siteowners’ deposition testimony, was executed for the sole purpose of allowing COCC to store raw materials and finished products in the warehouse. Seidenberg and Hutchinson received monthly lease payments of $200, which increased to $350 by 1980. In the mid-1970s, COCC expanded its business to include the brokering and recycling of chemical waste generated by third parties. It used the Bluff Road site as a waste storage and disposal facility for its new operations. In 1976, COCC’s principals incorporated South Carolina Recycling and Dis- posal Inc. (SCRDI), for the purpose of assuming COCC’s waste-handling business, and the site-owners began accepting lease payments from SCRDI. SCRDI contracted with numerous off-site waste produc- ers for the transport, recycling, and disposal of chemical and other waste. Among these producers were agencies of the federal government and South Carolina,? and various private . °The federal instrumentalities that contracted with SCRDI included the Environmental Protection Agency, the Army, the Air Force, and the Center for Disease Control. The South Carolina _B-6 entities including the three generator defendants in this titiga- tion. Although SCRDI operated other disposal sites, it depos- ited much of the waste it received at the Bluff Road facility. The waste stored at Bluff Road contained many chemical substances that federal law defines as “hazardous.” Between 1976 and 1980, SCRDI haphazardly deposited more than 7.000 fifty-five gallon drums of chemical waste on the four-acre Bluff Road site. It placed waste laden drums and containers wherever there was space, often without pallets to protect them from the damp ground. It stacked drums on top of one another without regard to the chemical compatibility of their contents. It maintained no documented safety proce- dures and kept no inventory of the stored chemicals. Over time many of the drums rusted, rotted, and otherwise deteri- orated. Hazardous substances leaked from the decaying drums and oozed into the ground. The substances com- mingled with incompatible chemicals that had escaped from other containers. generating noxious fumes, fires, and explo- sions. On October 26. 1977. a toxic cloud formed when chemi- cals leaking from rusted drums reacted wiih rainwater. Twelve responding firemen were hospitalized.* Again, on July 24, 1979, an explosion and fire resulted when chemicals stored in glass jars leaked onto drums containing incompatible substances. SCRDI's site manager could not identify the substances that caused the explosion, making the fire difficult to extinguish. In 1980. the Environmental Protection Agency (EPA) inspected the Bluff Road site. its investigation revealed that the facility was filled well beyond its capacity with chemical waste. The number of drums and the reckless manner in which they were stacked precluded access to various areas In the site. Many of the drums observed were unlabeled, or their labels had become unreadable from exposure, rendering it Department of Health and Environmental Control also contracted with SCRDI for waste disposal. ‘This incident sparked substantial publicity, and the siteowners concede that as of June 1977 they were aware of hazardous waste disposal activities taking place on their Bluff Road property. B-7 impossible to identify their contents. The EPA concluded that the site posed *“‘a major fire hazard.” Later that year, the United States filed suit under section 7003 of the Resource Conservation and Recovery Act, 42 U.S.C. § 6973, against SCRDI, COCC, and Oscar Seidenberg. The complaint was filed before the December 11, 1980. effec- tive date of CERCLA, and it sought only injunctive relief. Thereafter, the State of South Carolina intervened as a plaintiff in the pending action. In the course of discovery, the governments identified a number of waste generators, including the generator defend- ants in this appeal, that contracted with SCRDI for waste disposal. The governments notified the generators that they were potentially responsible for the costs of cleanup at Bluff Road under section 107(a) of the newly-enacted CERCLA. As a result of these contacts, the governments executed individ- ual settlement agreements with twelve of the identified off-site producers. The generator defendants, however, declined to settle. Using funds received from the settlements. the govern- ments contracted with Triangle Resource Industries (TRI) to conduct a partial surface cleanup at the site. The contract required RAD Services, Inc., a subsidiary of TRI, to remove 75% of the drums found there and to keep a log of the removed drums. RAD completed its partial cleanup operation in Octo- ber 1982. The log it prepared documented that it had removed containers and drums bearing the labels or markings of each of the three generator defendants. The EPA reinspected the site after the first phase of the cleanup had been completed. The inspection revealed that closed drums and containers labeled with the insignia of each of the three generator defendants remained at the site. The EPA also collected samples of surface water, soil, and sedi- ment from the site. Laboratory tests of the samples disclosed that several hazardous substances? contained in the waste the ‘The term “hazardous substance” is defined in section 101(14) of the CERCLA, 42 U.S.A. § 9601(14) (West Supp. !987). The definition incorporates by reference the substances listed as hazard- B-& generator defendants had shipped to the site remained present at the site.* Thereafter, South Carolina completed the remaining 25 of the surface cleanup. It used federal funds from the Haz- ardous Substances Response Trust | und (Superfund). 42 U.S.C. § 9631. as well as state money from the South Carolina Hazardous Waste Contingency Fund. 5.¢ Code Ann. § 56-160. and in-kind contribution of other state funds to match the federal contribution. 44 ++- In 1982. the governments filed an amended complaint. adding the three generator defendants and site-owner Harve) Hutchinson. and including claims under section 107(a) of CERCLA against all of the nonsettling defendants. The gov- ernments alleged that the generator defendants and site- owners were jointly and severally liable under section 107(a) for the costs expended completing the surface cleanup at Bluff Road. in response, the site-owners contended that they were innocent absentee landlords unaware of and unconnected to the waste disposal activities that took place on their land. They maintained that their lease with COCC did not allow COCC (or SCRDI to store chemical waste on the premises. but they admitted that they became unaware of waste storage in 1977 and accepted lease payments until 1980. ous or toxic under the Clean Water Act, 33 U.S.C.A. §§ 1317(a), 1321(b)(2)a) (West 1986), the Clean Air Act, 42 U.S.C. § 7412(b). the Resource Conservation and Recover) Act of 1976, 42 U.S.C.A.. § 6921 (West 1983 & Supp. 1987), and the Toxic Substances Control Act. 15 U.S.C. § 2606. Section 102¢a) of CERCLA also authorizes EPA to list additional substances that “‘may present substantial danger to the public health or welfare or the environment.” 42 U.S.C.A. § 9602(a) (West Supp. 1987). ‘It is undisputed that hazardous substances of the sort con- tained in each of the generator defendants’ waste materials were found at the site. These substances included 1.1,1-Trichloroethane, acetone, phenol, cresol (methyl phenol). chlorophenoi, and 2.4- dichlorophenol. governments response costs Among other detenses C aimed that none of their specific waste materials contribute oO the haZardous conditions Blutf Road nd t! e aC C position of ( I R¢ | \ ) I tne Was CONS The so asserted tl hey could establist L gete SC ) ( I R¢ | \ ) t\ nae me 0) lO”? ) » 4°) ‘io QAIT(h 4 a SHOWIN tr ne f nme site Re sed Sole nroug! ne conduct ol nre e( wo \ ) co ne Ite novec LOI ‘ 1g < 1 v de he Ing ne d ‘ \ UV) l YTa e gove ents) summ jJuaggment motion on CERCLA f L LU) ice ind h. [ re) | ie deiend in ‘ We v esponsibdie parties under section 107(a). and that none of em had presented sufficient evidence to support an affir ve defense under section 107(b The court further con cluded that the environmental harm at Bluff Road was “‘indi sible.” and it held all of the defendants jointly and severally, ve lor the governments response costs. United States \ South Carolina Recycline & Disposal. Inc.. 653 F. Si pp. 984 D.S.C. 1984) (SCRDI) As to the site-owners liabilitv. the court found it suffi ent that they owned the Bluff Road site at the time hazard us substances were deposited there. /d. at 993 (interpreting 42 U.S.C.A. § 9607(a)(2) (West Supp. 1987)). It rejected their contentions that Congress did not intend to subject ‘‘in- nocent’ landowners to CERCLA liability. The court similarly found summary judgment appropriate against the generator Section 101(25) of CERCLA provides that ** ‘respond’ or response means remove, removal, remedy, and remedial action, all such terms (including the terms ‘removal’ and ‘remedial action’) include enforcement activities related thereto.’ 42 U.S.C.A 9601(25) (West Supp. 1987). The terms ‘“‘remove’™’ and *‘removal,”’ and ‘remedy’ and ‘‘remedial action” are in turn defined at sections l01(23) and 101(24), 42 U.S.C.A. 8§ 9601 (23), (24) (West Supp 1987) In its initial summary judgment order, the court refused to hold COCC liable for response costs. After subsequent proceedings. however, the court found that COCC was engaged in a joint venture with SCRDI and therefore shared its liability for the governments’ costs. COCC has not appeaied from that ruling —————————— NT B-10 defendants because it was undisputed that (1) they shipped hazardous substances to the Bluff Road facility; (2) hazardous substances ‘‘like’’ those present in the generator defendants’ waste were found at the facility: and (3) there had been a release of hazardous substances at the site. SCRDI, 653 F. Supp. at 991-93 (interpreting 42 U.S.C.A. 8 9607(a)(3) (West Supp. 1987)). In this context, the court rejected the generator defendants’ arguments that the governments had to prove that their specific waste contributed to the harm at the site, and it found their constitutional contentions to be ‘without force.” SCRDI. 653 F. Supp. at 992-93, 995-98. Finally, since none of the defendants challenged the governments’ itemized ac- counting of response costs, the court ordered them to pay the full $1 $13.624 that had been requested. Id. at 1009, 1014. It refused. however, to add prejudgment interest to the amount owed. Id. at 1009. This appeal followed. Il. The site-owners and the generator defendants first con- test the imposition of CERCLA liability vel non, and they challenge the propriety of summary judgment in light of the evidence presented to the trial court. The site-owners also reassert the “innocent landowner” defense that the district court rejected, and claim that the court erroneously precluded them from presenting evidence of a valid affirmative defense under section 107(b)(3), 42 U.S.C. § 9607(b)(3). The generator defendants likewise repeat their arguments based on the governments’ failure to establish a nexus between their spe- cific waste and the harm at the site. They also claim that the trial court ignored material factual issues relevant to affir- mative defenses to liability. We address these contentions sequentially, but pause briefly to review the structure of CERCLA’s liability scheme. In CERCLA. Congress established “an array of mecha- nisms to combat the increasingly serious problem of hazard- ous substance releases.” Dedham Water Co. V. Cumberland Farms Dairy, Inc., 805 F.2d 1074, 1078 (Ist Cir. 1986).* xAs one district court has stated, the statute prov ides the federal government with “the tools necessary for a prompt and effective B-11 Section 107(a) of the statute sets forth the principal mecha- nism for recovery of costs expended in the cleanup of waste disposal facilities. At the time the district court entered judgment,’ section 107(a) provided in pertinent part: (a) Covered persons; scope Notwithstanding any other provision or rule of law, and subject only to the defenses set forth in subsection (b) of this section— (2) any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of, [and] (3) any person who by contract, agreement, or otherwise arranged for disposal or treatement, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility owned or operated by another party or entity and containing such hazardous sub- stances, and (4) ...from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance, shall be liable for—- (A) all costs of removal or remedial action incurred by the United States Government or a State not inconsistent with the national contin- gency plan. 4? U.S.C.A. § 9607(a) (West Supp. 1987). response to problems of national magnitude resulting from hazard- ous waste disposal,”’ and it evinces congressional intent “‘that those responsible for problems caused by the disposal of chemical poisons bear the costs and responsibility of remedying the harmful condi- tions they created.”’ United States v. Reilly Tar & Chemical Corp., 546 F. Supp. 1100, 1112 (D. Minn. 1982). Congress amended section 107(a) in 1986, Pub. L. No. 99-499, 100 Stat. 1628-30, 1692, 1693, 1705-06 (1986), but the changes are not material to the issues presented in this part of the appeal. B-12 In our view, the plain language of section 107(a) clearly defines the scope of intended liability under the statute and the elements of proof necessary to establish it.'° We agree with the overwhelming body of precedent that has interpreted section 107(a) as establishing a strict liability scheme.'' Fur- ther, in light of the evidence presented here, we are persuaded that the district court correctly held that the governments satisfied all the elements of section 107(a) liability as to both the siteowners and the generator defendants. a A. SITE-OWNERS) LIABILITY In light of the strict liability imposed by section 107(a), we cannot agree with the site-owners contention that they are not within the class of owners Congress intended to hold liable. The traditional elements of tort culpability on which the site-owners rely simply are absent from the statute. The plain language of section 107(a)(2) extends liability to owners of \0Many courts have provided succinct analyses of CERCLA’s legislative history, see generally Dedham Water Co. v. Cumberland Farms Dairy, Inc., 805 F.2d 1074, 1080-82 (Ist Cir. 1986); New York v. Shore Realty Corp., 759 F.2d 1032, 1039-42 (2d. Cir. 1985); United States Vv. Shell Oil Co., 605 F. Supp. 1064, 1068-79 (D. Colo. 1985). which are instructive but need not be repeated here because of the clarity of the liability provisions at issue. See Blum v. Stenson. 465 U.S. 886, 896 (1984) (Where... resolution of a question of federal law turns on a statute and the intention of Congress, we look first to the statutory language and then to the legislative history if the statutory language ts unclear.’’). See e.g., Levin Metals Corp. v. Parr-Richmond Terminal Co., 799 F.2d 1312. 1316 (9th Cir. 1986); New York v. Shore Realty Corp., 759 F.2d 1032, 1042 (2d Cir. 1985); Violet v. Picillo, 648 F. Supp. 1283, 1290 (D.R.1. 1986) (and cases cited therein); see also United States v. Northeastern Pharmaceutical & Chemical Co., 810 F.2d 726. 732 n.3 (8th Cir. 1986), cert. denied, 108 S. Ct. 146 (1987) (dictum). In addition to the unanimous judicial viewpoint that Congress intended CERCLA liability to be strict, we observe that CERCLA section 101(32). 42 U.S.C.A. § 9601(32) (West Supp. 1987), provides that the standard of liability applicable to CERCLA actions shall be that which governs actions under section 311 of the Clean Water Act. 33 U.S.C. § 1321. In Steuart Transportation Co. v. Allied Towing Corp., 596 F. 2d 609, 613 (4th Cir. 1979), we held that the standard of liability under section 311 is strict liability. B-13 waste facilities regardless of their degree of participation in the subsequent disposal of hazardous waste. Under section 107(a)(2), any person who owned a facility at a time when hazardous substances were deposited there may be held liable for all costs of removal or remedial action if a release or threatened release!? of a hazardous substance occurs. The site-owners do not dispute their ownership of the Bluff Road facility, or the fact that releases occurred there during their period of ownership. Under these circumstances, all the prerequisites to section 107(a) liability have been satisfied.'? See Shore Realty, 759 F.2d at 1043-44 (site-owner "The statute defines ‘release’ to include ‘‘any spilling, leak- ing, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment (including the abandonment or discarding of barrels, containers, and other closed receptacles containing any hazardous substance or pollutant or contaminani).”’ 42 U.S.C.A. § 9601(22) (West Supp. 1987). '*The site-owners’ relative degree of fault would, of course, be relevant in any subsequent action for contribution brought pursuant to 42 U.S.C.A. § 9613(f) (West Supp. 1987). Congress, in the Superfund Amendments and Reauthorization Act of 1986, Pub. L. 99-499, § 113, 100 Stat. 1613, 1647 (1986) [hereafter SARA], estab- lished a right of contribution in favor of defendants sued under CERCLA section 107(a). Section 113(f)(1) provides: Any person may seek contribution from any other person who is liable or potentially liable under section 9607(a) of this title, during or following any civil action under section 9606 of this title or under section 9607(a) of this title. Such claims shall be brought in accordance with this section and the Federal Rules of Civil Procedure, and shall be governed by Federal law. In resolving contribution claims, the court may allocate response costs among liable parties using such equitable factors as the court determines are appropriate. Nothing in this subsection shall diminish the right of any person to bring an action for contribution in the absence of a civil action under section 9606 or section 9607 of this title. 42 U.S.C.A. § 9613(f) (West Supp. 1987). The legislative history of this amendment suggests that in arriving at an equitable allocation of costs, a court may consider, among other things, the degree of involvement by parties in the generation, transportation, treatment, storage, or disposal of hazardous substances. H.R. Rep. No. 253 ) | B-14 held liable under CERCLA section 107(a)(1) even though he did not contribute to the presence or cause the release of hazardous substances at the facility.)'4 The site-owners nonetheless contend that the district court’s grant of summary judgment improperly denied them the opportunity to present an affirmative defense under sec- tion 107(b)(3). Section 107(b)(3) sets forth a limited affirmative defense based on the complete absence of causation. See Shore Realty, 759 F.2d at 1044. It requires proof that the release or threatened release of hazardous substances and resulting damages were caused solely by *‘a third party other than... one whose act or ommission occurs in connection with a contractual relationship, existing directly or indirectly, with the defendant... ..’ 42 U.S.C. § 9607(b)(3). A second element of the defense requires proof that the defendant ‘took precautions against forseeable acts or omissions of any such third party and the consequences that could foreseeably result from such acts or omissions.” Jd. We agree with the district court that under no view of the evidence could the site-owners satisfy either of these proof requirements. First, the site-owners could not establish the absence of a direct or indirect contractual relationship necessary to main- tain the affirmative defense. They concede they entered into a lease agreement with COCC. They accepted rent from COCC, and after SCRDI was incorporated, they accepted rent from SCRDI. See United States v. Northernaire Plating Co., 670 F. Supp. 742, 747-48 (W.D. Mich. 1987) (owner who leased facility to disposing party could not assert affirmative defense). Second, the site-owners presented no evidence that they took precautionary action against the forseeable conduct of COCC or SCRDI. They argued to the trial court that, although they were aware COCC was a chemical manufactur- (III), 99th Cong., Ist Sess. 19 (1985), reprinted in 1986 U.S. Code Cong. & Admin. News 3038, 3042. '4Congress, in section 101(35) of SARA, acknowledged that jandowners may affirmatively avoid liability if they can prove they did not know and had no reason to know that hazardous substances were disposed of on their land at the time they acquired title or possession. 42 U.S.C.A. § 9601(35) (West Supp. 1987). This explic- itly drafted exception further signals Congress’ intent to impose liability on landowners who cannot satisfy its express requirements. 5 aaa ail B-15 ing company, they were completely ignorant of all waste disposal activities at Bluff Road before 1977. They maintained that they never inspected the site prior to that time. In our view, the statute does not sanction such willful or negligent blindness on the part of absentee owners. The district court committed no error in entering summary judgment against the site-owners. B. GENERATOR DEFENDANTS’ LIABILITY The generator defendants first contend that the district court misinterpreted section 107(a)(3) because it failed to read into a statute a requirement that the governments prove a nexus between the waste they sent to the site and the resulting environmental harm. They maintain that the statutory phrase “containing such hazardous substances”’ requires proof that the specific substances they generated and sent to the site were present at the facility at the time of release. The district court held, however, that the statute was satisfied by proof that hazardous substances “‘‘like’’ those contained in the generator defendants’ waste were found at the site. SCRDI, 653 F. Supp. at 991-92. We agree with the district court’s interpretation. Reduced of surplus language, sections 107(a)(3) and (4) impose liability on off-site waste generators who: ‘arranged for disposal . . . of hazardous substances . at any facility ... containing such hazardous substances . . . from which there is a release. . . of a hazardous substance.” 42 U.S.C.A. 8§ 9607(a) (3), (4) (West Supp. 1987) (emphasis supplied). In our view, the plain meaning of the adjective ‘such’? in the phrase ‘“‘containing such hazardous sub- Stances”’ is “‘[a]like, similar, of the like kind.’’ Black’s Law Dictionary 1284 (Sth ed. 1979). As used in the statute, the phrase ‘‘such hazardous substances’’ denotes hazardous sub- stances alike, similar, or of a like kind to those that were present in a generator defendant's waste or that could have been produced by the mixture of the defendant’s waste with other waste present at the site. It does not mean that the plaintiff must trace the ownership of each generic chemical compound found at a site. Absent proof that a generator defendant’s specific waste remained at a facility at the time of B-16 release, a showing of chemical similarity between hazardous substances is sufficient.'* The overall structure of CERCLA’s liability provisions also militates against the generator defendants’ “‘proof of ownership’? argument. In Shore Realty, the Second Circuit held with respect to site-owners that requiring proof of ownership at any time later than the time of disposal would go far toward rendering the section 107(b) defenses superfluous. Shore Realty, 759 F.2d at 1044. We agree with the court's reading of the statute and conclude that its reasoning applies equally to the generator defendants’ contentions. As the statute provides—*‘[nJotwithstanding any other provision or rule of law’’—liability under section 107(a) is “*subject only to the defenses set forth’ in section 107(b). 42 U.S.C.A. § 9607(a) (West Supp. 1987) (emphasis added). Each of the three defenses'® established in section 107(b) “‘carves out from liability an exception based on causation.’ Shore Re- alty, 759 F.2d at 1044. Congress has, therefore, allocated the burden of disproving causation to the defendant who profited from the generation and inexpensive disposal of hazardous waste. We decline to interpret the statute in a way that would neutralize the force of Congress’ intent.!'’ ISCERCLA plaintiffs need not perform exhaustive chemical analyses of hazardous substances found at a disposal site. See SCRDI, 653 F. Supp. at 993 n.6. They must, however, present evidence that a generator defendant's waste was shipped to a site and that hazardous substances similar to those contained in the defendant’s waste remained present at the time of release. The defendant, of course, may in turn present evidence of an affirmative defense to liability. '6]n addition to the limited third-party defense discussed above. sections 107(b)(1) and (2) respectively allow defendants to avoid liability by proving that the release and resulting damages were ‘caused solely’’ by an act of God or an act of war. 42 U.S.C. § 9607(b)(1)(2). '7In fact, Congress specifically declined to include a similar nexus requirement in CERCLA. As the Second Circuit in Shore Realty observed, an early House version of what ultimately became section 107(a) limited liability to “‘any person who caused or contributed to the release or threatened release.”’ 759 F.2d at 1044 (quoting H.R. Rep. 7020, 96th Cong., 2d Sess. § 3071(a) (1980)), reprinted in 2 A Legislative History of the Comprehensive Environ- mental Response, Compensation and Liability Act of 1980 at 438. B-17 Finally, the purpose underlying CERCLA’s liability pro- visions counsels against the generator defendants’ argument. Throughout the statute’s legislative history, there appears the recurring theme of facilitating prompt action to remedy the environmental blight of unscrupulous waste disposal.'® In deleting causation language from section 107(a), we assume as have many other courts, that Congress knew of the synergistic and migratory capacities of leaking chemical waste, and the technological infeasibility of tracing improperly disposed waste to its source.'? In view of this, we will not frustrate the Statute’s salutary goals by engrafting a ‘‘proof of ownership” requirement, which in practice, would be as onerous as the language Congress saw fit to delete. See United States v. Wade, 577 F. Supp. 1326, 1332 (E.D. Pa. 1983) (*‘to require a plaintiff under CERCLA to ‘fingerprint’ wastes is to eviscer- ate the statute.*’). The generator defendants next argue that the trial court ignored evidence that established genuine factual issues as to the existence of an affirmative defense to liability. They maintain that summary judgment was inappropriate because they presented some evidence that all of their waste had been removed from Bluff Road prior to cleanup. We agree with the As ultimately enacted after House and Senate compromise, how- ever, CERCLA “imposed liability on classes of persons without reference to whether they caused or contributed to the release or threat of release.”’ Shore Realty, 759 F.2d at 1044. The legislature thus eliminated the element of causation from the plaintiff's liability case. Id.; see also United States v. Bliss, 667 F. Supp. 1298, 1309 (E.D. Mo. 1987) (“‘traditional tort notions, such as proximate cause, do not apply’’); Violet v. Picillo, 648 F. Supp. 1283, 1290-93 (D.R.I. 1986) (minimal causal nexus); United States v. Conservation Chem- ical Co., 619 F. Supp. 162, 190 (W.D. Mo. 1985): United States v. Wade, 577 F. Supp. 1326, 1331-34 (E.D. Pa. 1983). ‘The legislative history underlying the Superfund Amendments and Reauthorization Act of 1986 echoed this theme with even greater force than that underlying CERCLA’s original enactment in 1980. ‘In advancing their arduous proof requirements, the generator defendants make little mention of the fact that leaking chemicals may combine to form new compounds or escape into the atmo- sphere before proper response action can be taken. See cases cited supra note 17. B-18 trial court, however, that the materials on which the generator defendants rely were insufficient to create a genuine issue of material fact. The generator defendants offered only conclusory allega- tions, principally based *‘on information and belief,’’ that their waste, originally deposited at Bluff Road, was at some time prior to 1979 transported from that facility to other sites operated by SCRDI.*° To withstand summary judgment under section 107(b)(3), however, the generator defendants had to produce specific evidence creating a genuine issue that all of their waste was removed from the site prior to the release of hazardous substances there. See 42 U.S.C. § 9607(b)(3).7! In light of the uncontroverted proof that containers bearing each of the defendants’ markings remained present at the site at the time of cleanup and the fact that hazardous substances chemically similar to those contained in the generators’ waste were found, the generator defendants’ affidavits and deposi- 20The generator defendants offered the following materials: 1. An officer of the company that oversaw the final cleanup at Bluff Road testified that he did not know whether drums bearing Allied’s label actually contained Allied’s waste when they were removed from the site. 2. An officer of EM Industries averred that SCRDI assured him prior to 1980 that none of EM Industries’ waste had been deposited at Bluff Road. 3. An officer of Monsanto averred that two of his employees inspected the site in 1979, and while they “‘did not explore all areas of the site, upon information and belief they did not observe any drums of material taken from [Monsanto's plant].”’ 4. An officer of Allied averred that SCRDI’s site manager at Bluff Road told him in 1979 that all of Allied’s waste was removed from the site before 1977. None of these largely second-hand allegations were supported by evidence tending to show that any of the generators’ waste materials were actually taken away from the site. ““The mere existence of a scintilla of evidence in support of the [nonmoving party's] position will be insufficient [to avoid summary judgment]; there must be evidence on which the [finder of fact] could reason- ably find for the [nonmoving party].°° Anderson v. Liberty Lobby, Inc., 106 S. Ct. 2505, 2512 (1986). 2\Had they produced such evidence, it would have created an issue as to whether the “‘release or threat of release of a hazardous substance and the damages resulting therefrom were caused solely by ... an act or omission of a third party.”’ 42 U.S.C. § 9607(b)(3). B-19 tion testimony simply failed to establish complete removal as a genuine issue. See Celotex v. Catrett, 477 U.S. 317 (1986) (summary judgment appropriately granted against nonmoving party who failed to produce evidence supporting an element essential to its case on which it bore burden of proof at trial). The appellants next challenge the district court’s imposi- tion of joint and several liability for the governments’ re- sponse costs.*?? The court concluded that joint and several liability was appropriate because the environmental harm at Bluif Road was “‘indivisible’’ and the appellants had *‘failed to meet their burden of proving otherwise.’ SCRDI, 653 F. Supp. at 994. We agree with its conclusion. While CERCLA does not mandate the imposition of joint and several liability, it permits it in cases of indivisible harm. See Shore Realty, 759 F.2d at 1042 n.13: United States v. Chem-Dyne, 572 F. Supp. 802, 810-i1 (S.D. Ohio 1983). In each case, the court must consider traditional and evolving principles of federal common law,?? which Congress has teft to the courts to supply interstitially. >2The site-owners limit their joint and several liability argument to the contention that it is inequitable under the circumstances of this case, i.e., their limited degree of participation in waste disposal activities at Bluff Road. As we have stated, however, such equitable factors are relevant in subsequent actions for contribution. They are not pertinent to the question of joint and several! liability. which focuses principally on the divisibility among responsible parties of the harm te the environment. As many courts have noted, a proposed requirement that joint and several liability be imposed in all CERCLA cases was de'eted from the final version of the bill. See, e.g., Chem-Dyne, 572 F. Supp. at 806. “‘The deletion,’ however, ‘‘was not intended as a rejection of joint and several liability,”’ but rather “‘to have the scope of liability determined under common law principles.”’ /d. at 808. We adopt the Chem-Dyne court’s thorough discussion of CERCLA’s legislative history with respect to joint and several liability. We note that the approach taken in Chem-Dyne was subsequently confirmed as correct by Congress in its consideration of SARA’s contribution provisions. See H.R. Rep. No. 253 (1), 99th Cong., 2d Sess., 79-90 (1985). reprinted in 1986 U.S. Code Cong. & Admin. News at 2835, 2861-62. B-20 Under common law rules, when two or more persons act independently to cause a single harm for which there is a reasonable basis of apportionment according to the contribu- tion of each, each is held liable only for the portion of harm that he causes. Edmonds v. Compagni Generale Transatlan- tique, 443 U.S. 256, 260 n.8 (1979). When such persons cause a single and indivisible harm, however, they are held liable jointly and severally for the entire harm. /d. (citing Restate- ment (Second) of Torts § 433A (1965)). We think these principles, as reflected in the Restatement (Second) of Torts, represent the correct and uniform federal rules applicable to CERCLA cases. Section 433A of the Restatement provides: (1) Damages for harm are to be apportioned among two or more causes where (a) there are distinct harms, or (b) there is a reasonable basis for determining the contribution of each cause to a single harm. (2) Damages for any other harm cannot be appor- tioned among two or more Causes. Restatement (Second) of Torts § 433A (1965). Placing their argument into the Restatement framework, the generator defendants concede that the environmental damage at Bluff Road constituted a “single harm,” but . contend that there was a reasonable basis for apportioning the harm. They observe that each of the off-site generators with whom SCRDI contracted sent a potentially identifiable vol- ume of waste to the Bluff Road site, and they maintain that liability should have been apportioned according to the vol- ume they deposited as compared to the total volume disposed of there by all parties. In light of the conditions at Bluff Road, we cannot accept this method as a basis for apportionment. The generator defendants bore the burden of establishing a reasonable basis for apportioning liability among responsible parties. Chem-Dyne, 572 F. Supp. at 810; Restatement B-21] (Second) of Torts § 433B (1965).24 To meet this burden. the generator defendants had to establish that the environmental harm at Bluff Road was divisible among responsible parties. They presented no evidence, however, showing a relationship between waste volume, the release of hazardous substances. and the harm at the site.25 Further, in light of the comingling of hazardous substances, the district court could not have reasonably apportioned liability without some evidence dis- closing the individual and interactive qualities of the sub- stances deposited there. Common sense counsels that a million gallons of certain substances could be mixed together without significant consequences, whereas a few pints of others improperly mixed could result in disastrous consequences.*° Under other circumstances proportionate volumes of hazardous substances may well be probative of contributory harm.’ In this case, however. volume could not Section 433(B)(2) of the Restatement provides: Where the tortious conduct of two or more actors has combined to bring about harm to the plaintiff, and one or more of the actors seeks to limit his liability on the ground that the harm is capable of apportionment among them, the burden of proof as to the apportionment is upon each such actor. Restatement (Second) of Torts § 433(B)(2) (1965). >SAt minimum, such evidence was crucial to demonstrate that a volumetric apportionment scheme was reasonable. The govern- ments presented considerable evidence identifying numerous haz- ardous substances found at Bluff Road. An EPA investigator re- ported, for example, that in the first cleanup phase RAD Services encountered substances “‘in every hazard class, including explo- sives such as crystallized dynamite and nitroglycerine. Numerous examples were found of oxidizers, flammable and nonflammable liquids, poisons, corrosives, containerized gases, and even a small amount of radioactive material.’’ Under these circumstances, volu- metric apportionment based on the overall quantity of waste, as opposed to the quantity and quality of hazardous substances con- tained in the waste would have made little sense. *>We agree with the district court that evidence disclosing the relative toxicity, migratory potential, and synergistic capacity of the hazardous substances at the site would be relevant to establishing divisibility of harm. “Volumetric contributions provide a reasonable basis for ap- portioning liability only if it can be reasonably assumed, or it has B-22 establish the effective contribution of each waste generator to the harm at the Bluff Road site. Although we find no error in the trial court’s imposition of joint and several liability, we share the appellants’ conceini that they not be ultimately responsible for reimbursing more than their just portion of the governments’ response costs.** In its refusal to apportion liability, the district court likewise recognized the validity of their demand that they not be required to shoulder a disproportionate amount of the costs. It ruled. however, that making the governments © hole for response costs was the primary consideration and that cost allocation was a matter ‘“‘more appropriately considered in an action for contribution between responsible parties after plaintiff has been made whole.” SCRDI, 653 F. Supp. at 995 & n.&. Had we sat in place of the district court, we would have ruled as it did on the apportionment issue, but may well have retained the action to dispose of the contribution questions. See 42 U.S.C.A. § 9613(f) (West Supp. 1987). That procedural course. however, was committed to the trial court's discretion and we find no abuse of it. As we have stated, the defendants still have the right to sue responsible parties for contribution, and in that action they may assert both legal and equitable theories of cost allocation.*® been demonstrated. that independent factors had no substantial effect on the harm to the environment. Cf. Restatement (Second) of Torts § 433A comment d, illustrations 4, 5 (1965). >*The final judgment holds the defendants liable for slightly less than half of the total costs incurred in the cleanup, while it appears that the generator defendants collectively produced approximately 22% of the waste that SCRDI handled. Other evidence indicates that agencies of the federal government produced more waste than did generator defendant Monsanto, and suggests that the amounts contributed by the settling parties do not bear a strictly proportion- ate relationship to the total costs of cleaning the facility. We note, however. that a substantial portion of the final judgment is attribut- able to litigation costs. We also observe that the EPA has contrib- uted upwards of $50,000 to the Bluff Road cleanup, and that any further claims against the EPA and other responsible government instrumentalities may be resolved in a contribution action pursuant to CERCLA section 113(f). ~»Contrarv to the generator defendants’ request, it would be premature for us to interpret the effect of settlement on the rights of B-23 IV. The generator defendants raise numerous constitutional challenges to the district court's interpretation and application of CERCLA. They contend that the imposition of *‘dispro- portionate”’ liability without proof of causation violated con- stitutional limitations on retroactive statutory application and that it converted CERCLA into a bill of attainder and an ex post facte law. They further assert, along with the site- owners, that the trial court’s construction of CERCLA in- fringed their substantive due process rights. The district court held that CERCLA does not create retroactive liability, but imposes a prospective obligation for the post-enactment environmental consequences of the de- fendants’ past acts. SCRDI, 653 F. Supp. at 996. Alterna- tiveiy, the court held that even if CERCLA is understood to operate retroactively, it nonetheless satisfies the dictates of due process because its liability scheme is rationally related to a valid legislative purpose. /d. at 997-98. We agree with the court’s latter holding, and we find no merit to the generator defendants’ bill of attainder and ex post facto arguments.*° Many courts have concluded that Congress intended CERCLA’s liability provisions to apply retroactively to pre- enactment disposal activities of off-site waste generators. nonsetiling parties in contribution actions under CERCLA section 113(f)(2), 42 U.S.C.A. § 9613(f)(2) (West Supp. 1987). We observe, however, that the possibility this subsection precludes contribution actions against settling parties signals legislative policy to encourage settlement in CERCLA cieanup actions. At the same time, we recognize that the language of CERCLA’s new contribution provi- sions reveals Congress’ concern that the relative culpability of each responsible party be considered in determining the proportionate share of costs each must bear. The generator d¢fendants also assert, for the first time on appeal, that the district court’s interpretation of CERCLA violated the separation of powers doctrine. They argue that the court's imposition of strict liability without proof of factual causation departed from Congress’ intent, and that the court strayed from common-law principles in holding the defendants jointly liable. These arguments const [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385002_0954%3A1. Public record. Not legal advice.