Petition for Writ of Certiorari — Alcan Aluminum Corp. v. United States

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“FILED

) 03 438 SEP 182003

No. 03-

In the Supreme Court of the United States

ALCAN ALUMINUM CORPORATION, PETITIONER

UNITED STATES OF AMERICA;

STATE OF NEW YORK

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

PETITION FOR WRIT OF CERTIORARI

KENNETH W. STARR

KANNON K. SHANMUGAM

JOSEPH A. EISERT

ELIZABETH S. PETRELA

KIRKLAND & ELLIS LLP

655 Fifteenth Street, N.W.

Washington, DC 20005

(202) 879-5000

ROBERT H. BORK

6250 Ridge Street

McLean, VA 22101

(703) 288-1174

LAWRENCE A. SALIBRA, II

Counsel of Record

JOHN C. TILLMAN

MARK D. KINDT

ALCAN CORPORATION

6060 Parkland Boulevard

Mayfield Heights, OH 44124

(440) 423-6918

WILLIAM S. SESSIONS

HOLLAND & KNIGHT LLP

2099 Pennsylvania Avenue,

N.W.

Washington, DC 20006

(202) 955-3000

WILSON-EPES PRINTING CO., INC. — (202) 789-0096 — WASHINGTON, D. C. 20001

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QUESTION PRESENTED

Whether a company may be subjected to the Comprehensive

Environmental Response, Compensation, and Liability Act

(CERCLA), and held jointly and severally liable for the entire

cost of cleaning up a Superfund site, when its contributions to

the site contained at most trace amounts of potentially harmful

substances.

STATEMENT PURSUANT TO RULE 29.6

Alcan Aluminum Corporation is a wholly owned subsidiary

of Alcan Inc. Alcan Inc. has no parent corporation, and no

publicly held company owns 10% or more of its stock.

ill

TABLE OF CONTENTS

Page

QUESTION PRESENTED ..........s:ssssssseseseseneeseeenetenereenenenenens 1

STATEMENT PURSUANT TO RULE 239.6 .......::cecseeeesseeees ii

TABLE OF AUTHORITIES ...........::cessssesesseeessereteserneeseeseees iv

INTRODUCTION ...........ssccccsssscccsssssvcerscereseeossssnsscsnscserosonsers l

OPINIONS BELOW .........::ccccsssssssscssseeecrseeeneesseenessnnesseneeeens l

JURISDICTION .....0....ccccccccscosesssvesssssescnsesccvsecsosesessosessenccosevess ]

PERTINENT CONSTITUTIONAL AND STATUTORY

DRROIVISIOING. ...ccsecesscccsccssesesccscssnencnvensssoosenosenesnsessczcnrsosess 2

STATEMENT OF THE CASE .........:::ccssereeeseeessnceeeneeeneseeesens 3

REASONS FOR GRANTING THE WRIT ........:csceeseeeseeeeees 6

THE SECOND CIRCUIT ERRED BY SUBJECTING

A COMPANY TO CERCLA, AND BY HOLDING IT

JOINTLY AND SEVERALLY LIABLE, WHEN ITS

WASTE CONTAINED AT MOST TRACE

AMOUNTS OF A POTENTIALLY HARMFUL

SUBSTANCE. ........cecsssssscssssssovssssscsncssnensssscsscensnessseneensenes 6

A. The Second Circuit Erred By Concluding That A

Company Could Be Subject To CERCLA

Liability For Disposing Of Even A Non-

Hazardous Substance Simply Because It Contains

Trace Amounts Of A Potentially Harmful .

GeBGTRTIOE, .....cccrcscccsscsesesqressersssovessconseersnesssssevevnnpooecees 6

B. The Second Circuit Erred By Concluding That A

Company Could Be Jointly And Severally Liable

Under CERCLA Simply Because Its Product

Could “Spread” Hazardous Materials Produced

By Othe. .........ccscscsesesessseseneneeseseesssensseesesesesenenennenes 11

CONCLUSION ........sccsscsssssssssssssesrvonsssersnesnsssascresosaseccsonsens 15

TABLE GF AUTHORITIES

Page

CASES

B.F. Goodrich Co. v. Murtha,

SSE F2G UGE GG Cr. UII E recvesecesecescccssncesscsescoevvienseneces 7

Chem-Nuclear Sys., Inc. v. Bush,

SOD FDR FOOL, Gah. FRE vecnssinesvencvescsvecsensssnesenssovss 11

City of New York v. Exxon Corp.,

766 F. Supip. 177 (S.D.N.Y. 1991)......r..cccssrrercsrerssesseeeees 7

Dent v. Beazer Materials & Servs., Inc.,

EG Be SF GI Get, Fi iis creneccsnecneesnssssesesensissesncroavece 11

Exxon Corp. v. Hunt,

BTS ULB. FEe CA cece pene nsecesteeniowenennanesitiieveapvnninaisinnnn 6

Key Tronic Corp. v. United States,

SE UE, Ba ener wiecetersanicinvinralittnnnstasnniiicsennnvnnisis 6

Licciardi v. Murphy Oil U.S.A., Inc.,

Fee 6 Te | Re : Sree mennmNEn TIE 10

Long Beach Unified Sch. Dist. v. Dorothy B. Godwin Cal.

Living Trust,

Se Oa CG Cai Ge. FR invicsiveenctrsiverensiseciccesistncirssevees 1

Massachusetts v. Blackstone Valley Electric Co.,

OF FB FE1 Ci Ce. TRE cevvicncrnsrssesscnsneseiannnivicnresens 9,10

Morgan vy. Illinois,

SO4 U.S. TED C1FBZ) ..000sc000s0200000 AIST OTA OTT 8

O’Neil v. Picillo,

SES Fb FFG Caae Ca, TI weciccvsienesetarcsensniensennncncneesenes 11

United States v. Alcan Aluminum Co.,

DOG Fe Bak Ce Cele Ci ic iresesiensincessvesnnscsens 6, 7, 11, 12

United States v. Monsanto Co.,

ae Fe FE GI ale Se civiesitcentsnicncvmsasariscresininsnnes 11

STATUTES

QB U.S.C. § 1257 .cscsssssssecsesensesensnsecssenesensensnennsasecenenenenenneees 2

42 U.S.C. § 9601 .n.essssssesessersssescessnereenensensneensenensacsnenenneners 7

AZ U.S.C. § 9607 oo... esescsesesesesseesssnseessenssnsnnenanensncerersenenees 1,7

21 C.F.R. § 109.30 .....ccecesescsseserersrerenenenenenensesnensnenens 9, 10, 14

AO C.F.R. § 302.4 ....cessssssesesssscenssersnenensessnsenencarenenensnenencnnenss 7

OTHER AUTHORITIES

Boehlert, Oxley Team Up To Offer Pared-Down Liability

Relief Bill,

Superfund Week, Sept. 22, 2000, available at 2000 WL

V3761144...ccccccccessscsscscsssscsssssseresseensssssensssccssenssssoesnsesonsens 6

Stephen Breyer,

Breaking the Vicious Circle: Toward Effective Risk

Regulation (1995) .....s:ssssssssssseseeeenenrsseensensnnsnnennennenseestnes 10

John F. Manning,

The Absurdity Doctrine,

116 Harv. L. Rev. 2387 (2003) ......ssssecsrserseresrerseeeeseresnens 8

Alice M. Ottbani,

The Dose Makes The Poison (2d ed. 1997) ......-s:ssseseeeee 7

Antonin Scalia,

A Matter of Interpretation (1997) ....s.ss-ssesesesesesercenentenee 8

INTRODUCTION

This closely watched case presents questions of grave

importance to American industry concerning the application of

the Comprehensive Environmental Response, Compensation,

and Liability Act (CERCLA). The Second Circuit held that

petitioner could be liable for the entire remaining cost of

cleaning up two Superfund sites, even though the evidence

suggested that petitioner’s own contributions to the sites

contained at most trace amounts of pollutants. To bring

petitioner within CERCLA’s sweep, the Second Circuit gave

the triggering phrase “hazardous substance” an absurd

definition. It then compounded its error by abandoning basic

tort principles and refusing to apportion petitioner’s liability. If

allowed to stand, the Second Circuit’s decision will work an

unprecedented expansion of the already broad scope of

CERCLA — a statute that has memorably been described as “a

black hole that indiscriminately devours all who come near it.”

Long Beach Unified Sch. Dist. v. Dorothy B. Godwin Cal.

Living Trust, 32 F.3d 1364, 1366 (9th Cir. 1994) (Kozinski, J.)

(internal quotation omitted). The Second Circuit’s decision has

enormous practical consequences, because it will either lead to

selective prosecution or subject producers of common and

unquestionably non-hazardous substances to potentially

staggering Superfund liability. This Court should grant

certiorari to review the Second Circuit’s outlying decision.

OPINIONS BELOW

The Second Circuit’s opinion is reported at 315 F.3d 179 and

reprinted in the appendix (“App.”) at 2a-17a. The unreported

order denying the petition for rehearing en banc is reprinted at

App. la. The district court’s opinion is reported at 97 F. Supp.

2d 248 and reprinted at App. 18a-64a.

JURISDICTION

The Second Circuit entered judgment on January 7, 2003.

Petitioner timely filed a petition for rehearing en banc, which

was denied on April 21, 2003. On June 12, 2003, Justice

Ginsburg extended the time for filing this petition until

September 18, 2003. This Court has jurisdiction pursuant to 28

U.S.C. § 1254(1).

PERTINENT CONSTITUTIONAL AND STATUTORY

PROVISIONS

In relevant part, section 107 of CERCLA, 42 U.S.C. § 9607,

states as follows:

(a) Covered persons; scope; recoverable costs and damages;

interest rate; “comparable maturity” date

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

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 or incineration vessel owned or

operated by another party or entity and containing such

hazardous substances

* * *

[(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 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;

resources, including the reasonable costs of assessing such

injury, destruction, or loss resulting from such a release; and

(D) the costs of any health assessment or health effects study

carried out under section 9604(i) of this title.

STATEMENT OF THE CASE

1. This case arises from the efforts of respondents United

States and the State of New York (hereafter “the government”)

to recover costs incurred in remedying environmental

contamination at two waste-disposal sites in Oswego, New

York. See App. 3a. The first (and by far the larger) site was

operated by Pollution Abatement Services (PAS) from 1970 to

1977. See id. at 25a. The second site was operated by Fulton

Terminals, Inc., over the same period, and was used for

“overflow” waste from the PAS site. See id. at 33a.

During the period that the PAS and Fulton sites were in

operation, petitioner Alcan Aluminum Corporation sent waste

emulsion to those sites for disposal. See id. at 34a. That

emulsion was used in the processing of aluminum at Alcan’s

Oswego plant. See id. at 23a-25a. The emulsion consisted of

approximately 95% water and 5% mineral oil, but also carried

with it small aluminum shavings containing the naturally

occurring metals cadmium, chromium, copper, lead, and zinc.

See id. at 35a, 48a. Alcan sent some 4.6 million gallons of

emulsion to the PAS and Fulton sites. See id. at 4a, Sa.

2. In1977,the PAS and Fulton sites were abandoned. See

id, at 28a, 33a. Over the next ten years, the government spent

over $12 million cleaning up the PAS site. See id. at 19a. In

1987, the government brought suit under CERCLA te recover

response costs from 83 parties (including Alcan) that were

potentially responsible for environmental problems at the PAS

site. See id. at 18a. The government subsequently entered into

a settlement with all of the potentially responsible parties

except Alcan, under which those parties would pay

approximately $9.1 million of the cleanup costs for the PAS

site. See id. at 19a. Alcan refused to settle, on the ground that

= - = or — aceite te

the amount the government was seeking from Alcan ($3.2

million, or some 26% of the overall remediation costs) was

excessive in light of the makeup of Alcan’s waste emulsion.

See id.

The government therefore proceeded with litigation against

Alcan. See id.' In 1991, the district court initially entered

summary judgment for the government against Alcan, rejecting

Alcan’s argument that its waste emulsion was not a “hazardous

substance” under CERCLA because it contained less than the

naturally occurring environmental background levels of

cadmium, chromium, copper, lead, and zinc. See 755 F. Supp.

531, 536-39 (N.D.N.Y. 1991). But the Second Circuit reversed

in relevant part, reasoning that Alcan could avoid CERCLA

liability altogether if it could prove that “its pollutants

contribute[d] no more than background contamination.” 990

F.2d 711, 717 (2d Cir. 1993).

3. On remand before the district court, the government

abandoned its prior theory of liability in light of the Second

Circuit’s decision. Instead, it claimed, for the first time in the

litigation, that Alcan was liable because its waste emulsion

contained nickel, a _ naturally occurring metal, and

polychlorinated biphenyls (PCBs), a manmade substance. See

App. 35a-45a. Although neither nickel nor PCBs were found in

any tests of the emulsion from the PAS or Fulton sites, the

district court nevertheless accepted the government’s

circumstantial evidence that nickel and PCBs were contained in

that emulsion. See id. And the court rejected Alcan’s

alternative argument that it should be exempt from liability

' The government also pursued litigation against Alcan for the cleanup costs

of the much smaller Fulton site. See App. 4a-5a. That litigation was

subsequently consolidated with the litigation involving the PAS site. See id.

at Sa.

? Alcan vigorously disputed this finding, but the Second Circuit affirmed it.

See id. at 9a. The arguments presented in this petition do not turn on the

validity of this finding.

because its emulsion did not contain above-background levels

of PCBs, reasoning that PCBs were not naturally occurring

substances and therefore did not have “background” levels in

the environment. See id. at 49a-50a. The district court then

proceeded to hold Alcan jointly and severally liable for the

cleanup costs at the PAS and Fulton sites, rejecting Alcan’s

arguments that liability should be apportioned. See id. at 52a-

55a. The district court subsequently entered final judgment in

favor of the government for over $13.6 million. See id. at 5a.

The Second Circuit (Cardamone, J., joined by Straub and

Katzmann, JJ.) affirmed. See id. at 2a-17a. Relying on its

earlier decision, which stated that CERCLA does not impose

quantitative requirements for liability, the court reasoned that

the presence of any level of PCBs in Alcan’s waste emulsion

was sufficient to subject Alcan to CERCLA liability. See id. at

10a. The court then held that the “special exception” to liability

it created in its earlier decision for wastes with below-

background levels of “pollutants” was inapplicable to Alcan’s

emulsion because the emulsion contained PCBs, which are

“man-made substances without natural background levels.” Jd.

The court proceeded to reject Alcan’s further argument that its

liability should at least be apportioned, reasoning that (1)

Alcan’s emulsion contained at least some level of PCBs, and

therefore was not “harmless,” and (2) Alcan’s emulsion could

have “facilitated [the] transport” throughout the site of

hazardous substances produced by others. Id. at 10a-13a.

Finally, the court rejected Alcan’s constitutional challenge to

the retroactive application of CERCLA liability. See id. at 13a-

17a.

The Second Circuit denied rehearing by the panel and

rehearing en banc. See id. at 1a. This petition follows.

REASONS FOR GRANTING THE WRIT

THE SECOND CIRCUIT ERRED BY SUBJECTING A

COMPANY TO CERCLA, AND BY HOLDING IT

JOINTLY AND SEVERALLY LIABLE, WHEN ITS

WASTE CONTAINED AT MOST TRACE AMOUNTS OF

A POTENTIALLY HARMFUL SUBSTANCE.

A. The Second Circuit Erred By Concluding That A

Company Could Be Subject To CERCLA Liability

For Disposing Of Even A Non-Hazardous Substance

Simply Because It Contains Trace Amounts Of A

Potentially Harmful Substance.

The Second Circuit fundamentally erred in concluding that a

generator could be subject to CERCLA liability for disposing of |

a waste product that contained any amount of a potentially

harmful substance. If allowed to stand, that ruling will bring

even producers of common and unquestionably non-hazardous

substances within CERCLA’s ambit. Certiorari is warranted to

correct this bedrock error of interpretation.

As this Court has noted, CERCLA is “a comprehensive

Statute that grants the President broad power to command

government agencies and private parties to clean up hazardous

waste sites.” Key Tronic Corp. v. United States, 511 U.S. 809,

814 (1994). As this Court has also noted, however, CERCLA

“is not a model of legislative draftsmanship.” Exxon Corp. v.

Hunt, 475 U.S. 355, 363 (1986). Lower courts have agreed,

with one court noting that CERCLA was “passed in great haste”

and is “riddled with inconsistencies and redundancies,” United

States v. Alcan Aluminum Co., 964 F.2d 252, 258 n.5 (3d Cir.

1992). CERCLA’s potential breadth is notorious: one recent

example involved a reported threat to prosecute Girl Scouts for

disposing of trash that included pizza boxes. See Boehlert,

Oxley Team Up To Offer Pared-Down Liability Relief Bill,

Superfund Week, Sept. 22, 2000, available at 2000 WL

23761144.

As is relevant here, CERCLA imposes liability on “any

person who by contract, agreement, or otherwise arranged for

disposal or treatment * * * of hazardous substances * * * at any

facility from which there is a release, or a threatened release

which causes the incurrence of response costs.” 42 U.S.C.

§ 9607(a)(3)-(4). Although the statute itself does not speak to

the issue, courts, including the court below, have universally

held that liability under CERCLA is strict, with the result that

liability can be imposed even on unwitting parties. See, e.g.,

App. 6a. The statute, in turn, defines “hazardous substance” as,

inter alia, “any element, compound, mixture, solution, or

substance designated” as such by the EPA. 42 U.S.C.

§ 9601(14)(B). Among the substances designated as

“hazardous” by the EPA is any wastewater that has “come into

contact with process contaminants.” 40 C.F.R. § 302.4.

Although the EPA’s regulations specify certain quantities of

hazardous substances that must be contained in waste in order

to trigger CERCLA’s reporting requirements, see id., they

contain no analogous quantity requirements for purposes of

triggering CERCLA’s liability requirements, see Alcan, 964

F.2d at 259-61; B.F. Goodrich Co. v. Murtha, 958 F.2d 1192,

1200 (2d Cir. 1992); City of New York v. Exxon Corp., 766 F.

Supp. 177, 181-83 (S.D.N.Y. 1991).

It would be wholly illogical, however, to define “hazardous

substance” for liability purposes to include any product that

contains even trace amounts of potentially harmful substances.

A variety of unquestionably non-hazardous substances, from

milk to rainwater, contain trace amounts of substances that,

standing on their own, would be harmful. It is a matter of

common sense that whether a substance is harmful depends on

concentration and dose. See, e.g., Alice M. Ottbani, The Dose

Makes The Poison 6, 25 (2d ed. 1997) (“Every chemical has

some set of exposure conditions in which it is toxic and,

conversely, every chemical has some set of exposure conditions

in which it is not toxic.”). Interpreting “hazardous substance”

to include any product with even trace amounts of potentially

harmful substances would effectively read the word

“hazardous” out of CERCLA’s liability provisions, in

contravention of the basic canon of construction that statutes

should not be read in such a way as to render critical terms

meaningless. See, e.g., Morgan v. Illinois, 504 U.S. 719, 738

(1992). Put another way, such an interpretation would extend

strict liability under CERCLA to the producers of

unquestionably non-hazardous substances. This Court has

routinely “adjusted [even] unambiguous statutory commands to

avoid absurd results.” John F. Manning, The Absurdity

Doctrine, 116 Harv. L. Rev. 2387, 2389-91 (2003); cf Antonin

Scalia, A Matter of Interpretation 23 (1997) (“To be a textualist

in good standing, one need not be too dull to perceive the

broader social purposes that a statute is designed, or could be

designed, to serve * * *.”).

In its first decision in this case, the Second Circuit

recognized “some force to [the] argument” that giving

“hazardous substance” such a broad definition would lead to

absurd results, and therefore carved out an exception for waste

that contained lower than background levels of “pollutants”:

that is, levels below those that exist as a result of activities

unrelated to the waste at the site. 990 F.2d at 716-17. That

exception was designed to “shield from liability those entities

that have contributed ‘hazardous’ substances — defined as such

in the law — to a site but whose contribution — in the absence

of EPA thresholds — did not exceed natural background

levels.” App. 10a. In its subsequent decision, however, the

Second Circuit inexplicably limited its special exception to

“hazardous substances [that] occur in the environment

naturally.” Jd. In other words, the court held that a generator

could not escape CERCLA liability if its waste contained trace

amounts of manmade pollutants, on the ground that manmade

pollutants do not have any “natural background levels.” Jd.

In so holding, the Second Circuit simply ignored the reality

that manmade pollutants exist in trace amounts in virtually any

product, from milk to breakfast cereal, as well as in such

“natural” locations as soil and rainwater. Indeed, the EPA has

acknowledged this reality in its remediation policy, which does

not normally require cleanup for below-background levels of

potentially harmful substances, even manmade ones. See EPA,

Office of Solid Waste and Emergency Response, Office of

Emergency and Remedial Response, Role of Background in the

CERCLA Cleanup Program, OSWER 9285.6-07P, at 7 (Apr.

26, 2002). In articulating that rule, the EPA expressly

recognized that many manmade pollutants may have

environmental background levels above zero. See id. at 3, 5, %

In fact, with specific regard to PCBs, the Code of Federal

Regulations makes clear that PCBs are “ubiquitous” in the

environment. See 21 C.F.R. § 109.30(a). The Seconc Circuit’s

decision to treat manmade substances differently from naturally

occurring ones cannot be justified. By holding that the trace

quantities of PCBs in Alcan’s emulsion transformed that

emulsion into a “hazardous substance” subject to CERCLA

liability, the Second Circuit effectively extended the statute’s

reach to innocuous substances such as milk and rainwater.

At least two other courts of appeals have rejected a similar

approach in determining whether a substance is a “hazardous

substance” covered by CERCLA. In Massachusetts v.

Blackstone Valley Electric Co., 67 F.3d 981 (1995), the First

Circuit considered whether ferric ferrocyanide, a manmade

substance, constituted a “cyanide” and therefore a “hazardous

substance.” See id. at 989. In so doing, it rejected the EPA’s

proffered test for determining whether a substance constituted a

“cyanide,” which turned on the “total cyanide” contained in it.

See id. The court reasoned that such a test could lead to

“nonsensical results” because many everyday substances, such

as vitamin B-12, contained cyanide molecules. Jd. at 989-90.

The court concluded that such a test would be “untenably

overinclusive” because it would sweep in substances that “no

one, including the EPA, would categorize * * * [as] within the

meaning of * * * CERCLA.” /d. at 990. Similarly, in Licciardi

y. Murphy Oil U.S.A., Inc., 111 F.3d 396 (1997), the Fifth

Circuit suggested that a company could not be liable under

CERCLA for disposing of de minimis amounts of hazardous

substances. See id. at 399. Ataminimum, the Second Circuit’s

decision is in tension with these decisions, and this Court’s

review is therefore merited.

If allowed to stand, the Second Circuit’s decision will subject

a wide range of unquestionably non-hazardous products to

CERCLA liability. Cf Stephen Breyer, Breaking the Vicious

Circle: Toward Effective Risk Regulation 39, 40 (1995) (noting

that taking CERCLA’s ban on “carcinogens” literally would

lead to an “odd” result, because it would “mean{] not a single

molecule of aflatoxin, red dye no. 2, or benzene, or for that

matter, not the tiniest microscopic particle of pepper, spinach,

or mushroom” could be discharged into the environment)

(citations omitted). A number of food products, such as milk,

unavoidably contain certain quantities of PCBs. See 21 C.F.R.

§ 109.30(a). And although the government may wrap itself in

the mantle of prosecutorial discretion and claim that it would

never prosecute a party for “dumping” food products, it cannot

articulate a legitimate justification for treating food products

that contain PCBs differently from waste that contains similar

trace amounts of PCBs, but that (like food) is largely composed

of innocuous substances. If allowed to stand, the Second

Circuit’s definition of “hazardous substance” will either result

in unjustified selective prosecution or subject businesses to

potentially staggering liability for disposing of non-hazardous

products.

The Second Circuit’s interpretation of “hazardous substance”

sweeps far beyond what Congress could conceivably have

intended. While some lower courts have properly confined

CERCLA liability through judicially created exceptions, this

case illustrates why the Court cannot always rely on lower

courts todo so. This Court’s guidance is needed to make clear

that liability under CERCLA is not boundless. Certiorari

should be granted.

B. The Second Circuit Erred By Concluding That A

Company Could Be Jointly And Severally Liable

Under CERCLA Simply Because Its Product Could

“Spread” Hazardous Materials Produced By Others.

Having erred in concluding that Alcan’s emulsion was a

“hazardous substance,” the Second Circuit compounded its

error by holding Alcan jointly and severally liable for the

cleanup costs of the two sites (and thereby requiring Alcan to

pay more than its fair share of those costs). This aspect of

Second Circuit’s decision, too, will have sweeping

consequences. The logic of the Second Circuit's decision will

allow courts to assess joint and several liability against

companies that dispose of such innocuous substances as milk,

simply because such substances could “spread” hazardous

materials produced by others. For this reason, too, certiorari

should be granted.

Although CERCLA itself does not specifically address the

issue, courts have routinely held that joint and severai liability

may be imposed for CERCLA violations. See, e.g., Dent v.

Beazer Materials & Servs., Inc., 156 F.3d 523, 529 (4th Cir.

1998); Alcan, 964 F.2d at 268-69; O’Neil v. Picillo, 883 F.2d

176, 179 (1st Cir. 1989). In order to mitigate the potential

unfairness of requiring a defendant to pay more than its fair

share of cleanup costs, however, courts have allowed

defendants, consistent with ordinary tort principles, to show that

the harm they caused was divisible and therefore that liability

should be apportioned. See, e.g., Chem-Nuclear Sys., Inc. v.

Bush, 292 F.3d 254, 259-60 (D.C. Cir. 2002); O'Neil, 883 F.2d

at 179; United States v. Monsanto Co., 858 F.2d 160, 171-73

(4th Cir. 1988). Indeed, courts have suggested that aggressive

application of the principle of “divisibility is particularly

necessary to counteract CERCLA’s otherwise broad sweep.

See, e.g., Alcan, 964 F.2d at 261 n.13.

Although the Second Circuit paid lip service to the principle

of divisibility, its broad “migratory potential” exception to the

divisibility rule, if read literally, will swallow that rule

altogether. The Second Circuit’s fundamental error merits this

Court’s review.

The Second Circuit began by simply ignoring Alcan’s

evidence as to the relative amount of pollutants contained in

Alcan’s waste emulsion. The court reasoned that, “in light of

the district court’s conclusion that the waste emulsion contained

PCBs, it is unreasonable for Alcan to continue to insist that its

waste emulsion was harmless.” App. 1la. To be sure, Alcan

maintained in the court of appeals, as it had in the district court,

that there was insufficient evidence to demonstrate that there

were any PCBs in its waste emulsion (which, if proven, would

have immunized Alcan from CERCLA liability altogether). In

the alternative, however, Alcan also came forward with

uncontested evidence showing that, even if PCBs were present

in its emulsion, they were present only in minimal quantities.’

Specifically, Alcan proffered evidence that any PCBs in its

waste emulsion constituted no more than 0.01% of all oi the

known PCBs sent to the PAS site, and that those known PCBs,

in turn, constituted only 0.24% of all the waste at the site. See

C.A. App. 1196. This evidence provided a more than sufficient

basis on which to apportion liability.

The Second Circuit then proceeded to suggest that “focusing

individually on each constituent of [Alcan’s] waste * * * does

not provide an acceptable basis for establishing divisibility.”

App. lla. The only “hazardous” component of Alcan’s

3 Because the government introduced only circumstantial evidence that PCBs

were present at all in Alcan’s waste emulsion (such as evidence that PCBs

were present in waste emulsion subsequently produced by Alcan), it never

presented any evidence as to the quantity of PCBs in Alcan’s waste

emulsion.

emulsion that the Second Circuit recognized could give rise to

CERCLA liability was PCBs. See id. at 10a.* There was no

specific finding that the PCBs in Alcan’s waste emulsion

somehow interacted with any other hazardous component of

Alcan’s emulsion, nor that the PCBs interacted consequentially

with hazardous substances produced by other generators.

Instead, the Second Circuit, relying heavily on the district

court’s opinion, concluded that the presence of non-hazardous

substances in Alcan’s waste emulsion — namely, the water and

mineral oil that constituted virtually all of the emulsion —

barred Alcan from establishing divisibility, because those

substances could “facilitate[] [the] transport” of hazardous

substances produced by other generators, and therefore

“contributed to the breadth of contamination at both PAS and

Fulton.” Jd. at 12a-13a (internal quotation omitted). As the

district court put it, “[Alcan’s] emulsion had a mobilizing effect

on other hazardous wastes.” Jd. at 53a.

This startling determination threatens to blow the limits off

CERCLA liability entirely. As a threshold matter, the mere

addition of waste that itself has a low concentration of

hazardous material, even if it has the effect of spreading other

hazardous substances already at a site, is not necessarily

harmful. Indeed, such waste may actually have the beneficial

effect of diluting the concentration of those substances. Even

leaving that aside, however, the Second Circuit’s holding that a

party should be held jointly and severally liable based on the

“migratory capacity” of the non-hazardous component of its

waste, even where the hazardous component is admittedly

relatively small, is both illogical and, to the best of our

knowledge, unprecedented. Under the Second Circuit’s

* Although the district court also concluded, over Alcan’s objection, that

nickel was present in Alcan’s waste emulsion, see App. 35a-36a, it did not

conclude that nickel was present in greater than background levels, and the

Second Circuit therefore did not rely on the presence of nickel in refusing to

apportion Alcan’s liability, see id. at 10a-13a.

reasoning, even if Alcan’s waste emulsion had consisted solely

of water and mineral oil — assuming, for the moment, that such

a harmless emulsion could constitute a “hazardous substance”

under CERCLA — Alcan could be held entirely liable for the

cleanup costs for the two sites, simply because that entirely

non-hazardous emulsion could have absorbed hazardous

substances dumped by others and spread it to other locations.

In effect, therefore, the Second Circuit used the presence of a

minimal amount of PCBs in Alcan’s waste (which qualified it

as a “hazardous substance”) as a bootstrap to subject Alcan to

liability for all of the PCBs, and indeed all of the hazardous

substances, dumped at the two sites (with Alcan entitled only to

the limited offset of the disproportionately low share paid by the

settling defendants).

The Second Circuit’s rule would have the perverse effect of

subjecting to joint and several liability any company whose

“waste” happens to meet the court’s capacious definition of

“hazardous substance.”* This unjustifiable approach has the

potential further to broaden CERCLA’s sweep, and to threaten

businesses with the dramatic prospect of disproportionate and

burdensome liability for the cleanup costs of Superfund sites.

Certiorari is warranted in order to provide guidance to the

lower courts on these vitally important issues.

* As we have noted, milk contains PCBs and therefore would qualify as a

“hazardous substance” under the Second Circuit’s definition. See 21 C.F.R.

§ 109.30(a). Remarkably, moreover, because milk has similar solubility

qualities to Alcan’s waste emulsion, see C.A. App. 1057, the mere disposal

of milk could give rise to joint and several liability under the Second

Circuit’s rule.

CONCLUSION

For the foregoing reasons, this Court should grant the

petition for certiorari.