Amicus Curiae Brief — United States v. Atlantic Research Corp.

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No. 06-562

In the

SUPREME COURT OF THE UNITED STATES

UNITED STATES OF AMERICA,

Petitioner,

ATLANTIC RESEARCH CORPORATION,

Respondent.

On Petition For A Writ of Certiorari to the

United States Court of Appeals for the Eighth Circuit

BRIEF OF AMICUS CURIAE

AVIALL SERVICES, INC.

IN SUPPORT OF RESPONDENT

RICHARD FAULK

(Counsel of Record)

JEFFREY M. GABA

STACY R. OBENHAUS

GARDERE WYNNE SEWELL LLP

3000 Thanksgiving Tower

Dallas, Texas 75201-4761

(214) 999-3000

Counsel for Amicus Curtae Aviall Services, Inc.

TABLE OF CONTENTS

Page

RE Ie FEF eS circ nerinicnecstseicccnnnessneneesanenanesinin ii

SE ATI T OR TU TIS acces encsesesscenccccvesocecensacsvenenssee 1

SUMMARY OF THE ARGUMENT .........ssssssssssssssesseeeeee 1

I sieiiisiicicniteicinecieaienianieiitasaieaitetaianiisasasenniiitnii 3

I. The Plain Language Of Section

107(a)(4)(B) Authorizes Cost Recovery

By Any Person Other Than Certain

I Se scisarseniesiniancicsitncioreneuniaininsinis 3

ll. The Legislative History of CERCLA

Supports This Comstruction...........cccsceseeeesesecen 7

i]. | The Government Provides No Authority

For Its Construction of Subsection

ED inintirnesiinonsenincinicsiedesiiianiiienianinmneneiints 10

aN cessicenivsstiiieeriaseniinnteniieabinapianaiianiabtnnisininamets 13

TABLE OF AUTHORITIES

Cases

Atlantic Research Corp. v. United States,

459 F.3d 827 (8th Cir. 2006), cert. granted,

127 S. Ct. 1144 (U.S. Jan. 19, 2007)... eceeeeeeeees

Aviall Services, Inc. v. Cooper Industries, Inc.,

No. 06-10996 (5th Cir. docketed

SRS arte a Rey A AERO

Consolidated Edison Co. of New York, Inc. v. UGI

_ Utilities, Inc., 423 F.3d 90 (2d Cir. 2005),

pet. for cert. pending, No. 05-1323 (US.

filed Apr. 14, 2006) ...sccesscsssssssssssssessesseseseeeeeeeee

Cooper Industries, Inc. v. Aviall Services, Inc.,

543 U.S. 157 (2004)..ecsccssesesscssssssesesseessscsssssnsenseseeeee

Jama v. Immigration Services,

543 U.S. 335 (2005).....cccsscccecessesessssssssecesssesesesensene

Metropolitan Water Reclamation District of Greater

Chicago v. North American Galvanizing and

Coatings, Inc., 473 F.3d 824 (7th Cir. 2007).......

Porto Rico Ry. Light & Power Co. v. Mor,

< I saeeccicahceiina

United States v. E.I. DuPont De Nemours & Co.,

432 F.3d 161 (3d Cir. 2005) .....csccssssscssscsscsseceeeeeee

Washington State Dep’t of Transp. v. Washington

Natural Gas Co.,

59 F.3d 793 (9th Cir, 1995) ..ccccccssssvscsessessesesssseseeeee

Whitman v. American Trucking,

Statutes and legislative history

Comprehensive Environmental Response,

Compensation, and Liability Act, 42

US.C.A. §§ 9601-9675 (West 2005)...

42 U.S.C.A. § 9601 (West 2005) ....cccsscsssssssssesseseeseeeee

42 US.C.A. § 9607 (West 2005) ...cccccsscscssssssssssssssseensee

Federal Water Pollution Control Act

Amendments of 1972, Pub. L. No. 92-500,

§ 502(5), 1972 U.S.C.C.A.N. (86 Stat. 816)

Superfund Amendments and Reauthorization

Act of 1986, Pub. L. No. 99-499, § 207,

1986 U.S.C.C.A.N. (100 Stat.) 1613, 1705........

ili

S. 1480, 96th Cong. (as reported by S. Fin.

Sig, FEOO. TE, Fi iererncrensccineremnntasvenvenin 7,8,9

126 Cong. Rec. 14964 (Nov. 24, 1980) ..........sscscsesseeeeesesees 9

126 Cong. Rec. S14988 (Nov. 24, 1980) .........cccesseeeseeeeeees 7

126 Cong. Rec. S15009 (Nov. 24, 1980) .........c.ccceseseeeeseees 7 -

Other authorities

Frank P. Grad, A Legislative History of the

Comprehensive Environmental Response,

Compensation and Liability ("Superfund")

Act of 1980, 8 COLUM. J. ENVTL. L. 1 (1982) ........... 7

STATEMENT OF INTEREST

Amicus curiae Aviall Services, Inc., is a party in a

case before the United States Court of Appeals for the

Fifth Circuit: Aviall Services, Inc. v. Cooper Industries,

Inc., No. 06-10996 (5th Cir. docketed Sept. 18, 2006).

The issue that Aviall intends to raise in that appeal is

the very issue presented by petitioner United States of

America in the present case before this Court. Both the

United States and the respondent, Atlantic Research

Corporation, have consented to Aviall’s submission of

this amicus brief, and those parties’ written consent is

submitted herewith.

Counsel for Aviall authored this brief in whole.

No person or entity other than Aviall made a monetary

contribution to preparation or submission of this brief.

SUMMARY OF THE ARGUMENT

The Court of Appeals for the Eighth Circuit held

that persons who are themselves potential liable parties

under the Comprehensive Environmental Response,

Compensation, and Liability Act, 42 U.S.C.A. §§ 9601-

9675 (West 2005) (CERCLA), but who are not eligible to

sue under section 113(f) of the Act, have a right of cost

recovery under section 107 of the Act. The court held

that this cause of action arises under the express

language of section 107(a)(4)(B) or, alternatively, as an

implied right of contribution. Aviall submits this brief

in support of the court of appeals’ conclusion that a

right of cost recovery arises under the plain language

of section 107(a)(4)(B).

Under CERCLA section 107(a), an enumerated

group of potentially responsible parties (PRPs) are

liable for. response costs incurred by (A) the United

States, states, or Indian tribes, or (B) “any other

person.” Since PRPs are themselves “persons” under

the statute, the plain meaning of this provision is that

an individual PRP is liable to the government entities

or any other “ person” — including other PRPs.

The word “other” in clause (B) simply acts to

distinguish the persons eligible to sue under clause (B)

from the class of government entities, themselves

defined as persons, entitled to sue under clause (A).

This construction is consistent with the structure of

CERCLA since the government “persons” suing under

clause (A) have a lighter burden of proof than the

“other” persons that must sue under clause (B).

The legislative history of CERCLA supports this

construction. The amendments that inserted the word

“other” in clause (B) also added “United States” to the

definition of “person.” Thus, the reference to “other”

person can be seen as a simple drafting revision

necessitated by the inclusion of the United States

within the class of “persons.” Nothing in the legislative

history indicates that the inclusion of the word “other”

was intended to fundamentally alter the scope of

liability under CERCLA. Indeed, in the first twenty-

five years following adoption of CERCLA, no court

construed section 107(a)(4)(B) to exclude PRPs, and the

Government indeed cites no case law supporting its

construction of the statute.

ARGUMENT

I. THE PLAIN LANGUAGE OF SECTION 107(A)(4)(B)

AUTHORIZES COST RECOVERY By ANY PERSON

OTHER THAN CERTAIN GOVERNMENT ENTITIES.

CERCLA section 107 provides that an enumerated

list of persons described in subsection 107(a)(1)-(4)—

persons usually referred to as “potentially responsible

parties” or “PRPs” —shall be liable for:

(A) all costs of removal or remedial action —

incurred by the United States Government 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.

42 US.C.A. § 9607(a)(4) (West 2005). The question in

this case is whether the “other person” referred to in

subsection (B) above can be a person who is a PRP.

The Government concedes that, but for the inclusion of

the word “other” in the phrase “any other person,”

section 107(a)(4)(B) would “unambiguously” authorize

a cause of action by a PRP. Brief for the United States

at 19. Thus, the Government's entire argument hinges

on their interpretation of this word.

The Government argues that the word “other” in

the phrase “any other person” in subsection (B)

distinguishes those persons authorized to seek cost

recovery from “the universe of persons who fall into

the four categories enumerated in Section 107(a)(1)-

(4).” Brief for the United States at 15. In other words,

the Government would rewrite section 107(a)(4)(B) to

provide a right of cost recovery “to any person other

than a PRP.” The Government says this interpretation

is the “most natural reading” of section 107(a). Brief

for the United States at 15.

But the Government's reading is actually quite

“unnatural” and is inconsistent with the plain language

of this section. On its face, section 107(a)(4)(B)

provides that a PRP is liable to “any other person.”

“Person” is broadly defined in CERCLA section 101 to

include, among others, individuals, corporations, the

United States government, and a state. See 42 U.S.C.A.

§ 9601(21) (West 2005).! Thus, section 107(a)(4)(B)

simply provides that those persons who are PRPs are

liable to any other “individual, firm, corporation,” etc.,

who has properly incurred response costs.

Furthermore, the most natural construction of the

reference to “other” persons in section 107(a)(4)(B) is to

distinguish the “persons” with a right of cost recovery

under subsection (B) from the government entities with

a right of cost recovery under subsection (A). Indeed,

the statute’s language compels this construction. The

' Section 101(21) defines “person” as “an individual, firm,

corporation, association, partnership, consortium, joint venture,

commercial entity, United States Government, State, municipality,

commission, political subdivision of a State, or any interstate

body.” 42 U.S.C.A. § 9601(21) (West 2005).

Although this definition does not expressly include “Indian

tribes,” other provisions of CERCLA refer to Indian tribes as

“persons.” See, e.g., 42 US.C.A. § 9607(i), (j) (West 2005). The

reference to “Indian tribes” in the class of government entities in

section 107(a)(4)(A), was added by the Superfund Amendments

and Reauthorization Act of 1986, Pub. L. No. 99-499, § 207(c)(1),

1986 U.S.C.C.A.N. (100 Stat.) 1613, 1705.

governmental entities specified in (A), including the

United States and the states, are specifically defined as

“persons” in section 101 of the Act. Therefore, it is

necessary to distinguish between those “persons”

(government entities) who may bring a lawsuit under

subsection (A) from all “other” persons who may bring

a lawsuit under subsection (B). In short, subsection

107(a)(4)(A) establishes liability to Person A (the

United States) and to Person B (a State or Tribal

authority), while subsection 107(a)(4)(B) establishes

liability to “any other person.”

Such a construction is consistent with the structure

of CERCLA. Under subsection (A), the government

entities are entitled to recover their response costs if

those costs are “not inconsistent” with the national

contingency plan (“NCP”). In _ contrast, under

subsection (B) all persons other than government

entities are entitled to recover their response costs only

if those costs are “consistent” with the NCP.

This difference in language has significant

consequences. For government cost recovery under

subsection (A), the burden of proof is on the defendant

to show that the government costs were not consistent

with the NCP. For cost recovery by all other parties,

the burden of proof is on the plaintiff to show their

costs were consistent with the NCP. See, e.g., United

States v. E.I. DuPont De Nemours & Co., 432 F.3d 161,

178 (3d Cir. 2005) (en banc); Washington State Dep’t of

Transp. v. Washington Natural Gas Co., 59 F.3d 793, 799-

800 (9th Cir. 1995). Thus, Congress imposed a lighter

burden for cost recovery by government entities than

they did for “other persons.”

This construction of the phrase “other person” is

adopted by the Seventh Circuit in Metropolitan Water

Reclamation District of Greater Chicago v. North American

Galvanizing and Coatings, Inc., 473 F.3d 824, 835 (7th Cir.

2007) (reading “other” as distinguishing “any other

person” from the United States, a state, or an Indian

tribe as listed in preceding subsection (A)); the Second

Circuit in Consolidated Edison Co. of New York, Inc. v.

UGI Utilities, Inc., 423 F.3d 90 (2d Cir. 2005), pet. for cert.

pending, No. 05-1323 (US. filed Apr. 14, 2006); and the

Eighth Circuit, Atlantic Research Corp. v. United States,

459 F.3d 827 (8th Cir. 2006), cert. granted, 127 S. Ct. 1144

(U.S. Jan. 19, 2007).

The Government, however, claims that the

language of section 107(a) “definitively forecloses” this

obvious interpretation. Brief for the United States at

20. Under section 107(a)(4)(B), persons are entitled to

recover “any other necessary costs of response. . .”

The Government, quite properly, states that this refers

to costs other than those incurred by the government

entities specified in 107(a)(4)(A). The Government

asserts that the reference to “other” costs would be

superfluous if “other persons” were construed to refer

to persons other than government entities.

That assertion artificially constricts the flexibility of

the English language—even as used in Congressional

legislation. It is hardly an odd construction to state

that PRPs, in addition to being liable for certain costs

incurred by government entities, are also liable for any

“other” costs incurred by persons “other” than the

government. This repetition of the word “other” raises

no eyebrows; it is a sensible enough English sentence.

More important, the legislative history discussed

below explains why both uses of the word “other”

occur in section 107(a)(4)(B). See infra section II.

Il. THE LEGISLATIVE HistoRY OF CERCLA SUPPORTS

THIS CONSTRUCTION

The clear and straightforward construction of the

phrase “any other person” in subsection 107(a)(4)(B) to

include all persons other than the government entities

specified in subsection 107(a)(4)(A) does not require

resort to legislative history. Nonetheless, legislative

history supports this construction.

The legislative history of CERCLA is confused, but

certain aspects of this history are clear. Senate Bill 1480

in the 96th Congress was the U.S. Senate’s vehicle for

enactment of what ultimately became CERCLA. The

original version of S. 1480 was replaced in its entirety

by a version introduced by Senator Stafford and

managed on the floor by Senator Randolph. See 126

Cong. Rec. S14988 (Nov. 24, 1980). This new version of

S. 1480, called the “Stafford/Randolph” - substitute,

ultimately became the final version of CERCLA. 126

Cong. Rec. S15009 (Nov. 24, 1980); see Frank P. Grad, A

Legislative History of the Comprehensive Environmental

Response, Compensation and Liability (“Superfund”) Act of

1980, 8 COLUM. J. ENVTL. L. 1, 21 (1982).

As the Government notes, the original version of S.

1480 authorized cost recovery by the United States

Government or a State, and “any person.” Brief for the

United States at 18-19. Under section 4 of this original

version, PRPs were liable for (a) certain costs incurred

by “the United States or a State” or (b) “any other

costs” incurred by “any person.” See S. 1480, 96th

Cong. § 4(a)(1)(B) (as reported by S. Fin. Comm., Nov.

18, 1980). The Government concedes that, pursuant to

this language, PRPs “unambiguously” would have had

a cause of action. Brief for the United States at 19.

Yet this language was subsequently amended, and,

under the Stafford/Randolph substitute, PRPs were

liable to the United States Government, or a State or

any “other” person. The Government states that there

is no explanation for this change in the legislative

history, and it asserts that the “only plausible

explanation” for insertion of the word “other” is to

exclude PRPs from bringing suit under CERCLA.

The Government does not, however, fully describe

the changes made by the Stafford/ Randolph substitute.

Under the original version of S. 1480 (the version

which allowed cost recovery by the United States, a

State or “any person”) the definition of “person” did

not include the United States.2_ The Stafford/ Randolph

substitute (as does CERCLA today) defined person to

specifically include the United States. The “plausible”

explanation is that, with the inclusion of the United

States in the definition of persons, the addition of the

word “other” was a simple drafting issue necessary to

clarify that the persons eligible to sue under subsection

2 In the original version of S. 1480, the word “person” was

defined by referring to the definition in section 502 of the Clean

Water Act. See S. 1480, 96th Cong. § 2(2) (as reported by S. Fin.

Comm., Nov. 18, 1980) (“the terms ‘State’, ‘person’, ‘navigable

waters’, and ‘territorial seas’ shall have the meaning provided in

section 502 of the Clean Water Act”). Then, as now, the definition

of “person” in section 502 of the Clean Water Act did not include

tite United States. See Federal Water Pollution Control Act

Amendments of 1972, Pub. L. No. 92-500, § 502(5), 1972

US.C.C.A.N. (86 Stat. 816) 951, 1036 (renamed Clean Water Act of

1977, Pub. L. No. 95-217, 1977 US.C.C.A.N. (91 Stat.) 1566)

(codified as amended at 33 US.C.A. § 1362(5) (West 2001))

(defining *person” to mean “individual, corporation, partnership,

association, State, municipality, commission, or political

subdivision of a State, or any interstate body”). ,

(a)(4)(B) were different from the persons (now defined

to include the United States) authorized to sue under

subsection (a)(4)(A).°

In the Senate debate, Senator Randolph described

major changes made by the Stafford/Randolph

substitute. Among the changes, he mentions deletion

of the “Federal cause of action for medical expenses or

property or income loss.” 126 Cong. Rec. 14964 (Nov.

24, 1980). Nowhere here or elsewhere in the legislative

history is there any indication that the inclusion of the

word “other” in the Stafford/ Randolph substitute was

intended to limit a right of cost recovery by PRPs that

the Government admits would otherwise have

“unambiguously” existed.

Nor would it be plausible for Congress to have

fundamentally altered the scope of CERCLA through

the otherwise unremarked inclusion of the word

“other.” As Justice Scalia has noted: “Congress .. .

does not alter the fundamental details of a regulatory

scheme in vague terms or ancillary provisions —it does

not, one might say, hide elephants in mouseholes.” See

Whitman v. American Trucking, 532 U.S. 457, 469 (2001).

Few elephants are larger than precluding PRPs from

3 This aiso explains why subsection 107(a)(4)(B) contains a

reference to “other” costs. The original version of S. 1480 imposed

liability for “any other costs” incurred by “by any person.” See S.

1480, 96th Cong. § 4(a)(1)(B) (as reported by S. Fin. Comm., Nov.

18, 1980) (providing liability for “any other costs or expenses

incurred by any person to remove a hazardous substance as the

terms ‘remove’ or ‘removal’ are defined in section 311(a)(8) of the

Clean Water Act”). Although the inclusion of the United States

within the definition of “person” required the change to “any

other person,’ there was no need to revise the existing reference to

“any other costs.”

seeking cost recovery following a proper cleanup; few

mouseholes are tinier than the, government's narrow

reading of the word “other.”

III. THE GOVERNMENT PROVIDES NO AUTHORITY FOR

ITS CONSTRUCTION OF SUBSECTION 107(A)(4)(B)

The Government argues that the word “other”

excludes the class of PRPs from the persons who are

otherwise eligible to bring a cost recovery action under

section 107(a)(4)(B). The Government's entire “plain

language” argument is contained in the syllogism that

introduces their argument on this issue. According to

the Government:

e PRPs, the universe of persons specified in

. section 107(a)(1)-(4), are liable to “any other

person.”

e PRPs are themselves a “person.”

e Therefore, the phrase “any other person”

excludes the “persons” that are the subject of the

sentence.

4 In support of their construction of subsection 107(a)(4)(B),

the Government cites a sentence from Jama v. Immigration Services,

543 US. 335, 343 n.3 (2005). Brief for the United States at 15. As

discussed below, the statutory construction issues raised by Jama

are different from those involved in this case, and Jama provides

no support for their interpretation. Nonetheless, we do note that

Justice Scalia rejected an argument that an amendment, inserting

the word “another” in the phrase “another country,” should be

construed to have “momentous consequences.” In /ama Justice

Scalia concluded that other contemporaneous stylistic changes to

the statute explained and minimized the significance of that

specific change. Here, of course, other contemporaneous changes

to CERCLA explain the insertion of the word “other” in the phrase

“any other person.”

See Brief for the United States at 15. The Government,

of course, misstates the structure of section 107(a).

Section 107(a) provides that PRPs are liable to both (A)

persons who are-government entities, and (B) any

“other” person. The “other,” as discussed above, quite

clearly acts to distinguish the parties who can sue

under (B) from those who can sue under (A).

But even if, as the Government mischaracterizes it,

section 107 provided simply that a person who is a PRP

is liable to “any other person,” this would not support

the leap of logic contained in the Government's

“therefore.” The obvious construction of such a phrase

is that an individual PRP is liable to any other person -

including other PRPs. The Government acknowledges

the possibility of this construction, but it disrnisses this

argument with the claim that “the text of the statute”

makes “all” PRPs, in the conjunctive, liable to “any

ocher person.” Brief for United States at 21 n.10.5

Section 107(a) does not, of course; state that “all”

PRPs are liable to anyone. It specifies that an

enumerated list of types of PRPs, linked in the

conjunctive by “and,” are liable. This use of the word

> Only by somehow lumping all individuals who fall within

the category of PRPs as a separate class of persons is the

Government's argument everreoherent. But if persons lose a right

of cost recovery simply because they fall within the category of

PRPs, the Government's reading produces absurd results. A

corporation that owned some contaminated property (and thus

fell within the category of PRPs) would lose a right of cost

recovery relating to its cleanup of other properties that it had not

contaminated. In other words, a person who was responsible for

contamination at a site would not be liable under section

107(a)(4)(B) if the plaintiff happened to be a PRP at some other site

elsewhere in the country. Nothing compels this odd construction.

“and” simply does not address the issue of whether

individual PRPs are liable to “any other person,”

including other persons who are PRPs. Is the

Government seriously suggesting that if the list of

PRPs in section 107(a) were linked by the word “or,”

the scope of persons who could sue under section

107(a)(4)(B) would be fundamentally different?

In the twenty-five years following the adoption of

section 107(a)(4)(B), not a single court held that the

phrase “any other person” excludes PRPs.° Indeed, the

Government provides only two citations in support of

its remarkable “therefore.” Curiously, these two cases,

Porto Rico Ry. Light & Power Co. v. Mor, 253 U.S. 345

(1920), and Jama v. Immigration Services, 543 U.S. 335

(2005), reach conflicting conclusions on the simple

question of whether a condition that is located at the

end of a list of items should apply to all items on the

list or only the last item. The sentences from the cases,

plucked out of context by the Government, do not add

support for the Government's position. The results in

both of these cases are closely tied to the history and

purpose of the specific statutes at issue. Neither case

involves construction of statutes that are either

syntactically or logically apt in interpreting CERCLA

subsection 107(a)(4)(B).

6 Indeed, Aviall has not identified a single case in which this

argument was even made before Cooper Industries, Inc. v. Aviall

Services, Inc., 543 U.S. 157 (2004).

CONCLUSION

Aviall Services, Inc., supports the position of the

respondent, Atlantic Research Corporation, that this

Court affirm the court of appeals’ judgment.

Respectfully submitted,