Amicus Curiae Brief — Alcan Aluminum Corp. v. United States

J supreme Court, U.S. |

KFIDGDED

No. 03-433 DEC 4 2 2003

OFFICE -

IN THE OF THE CLERK

Supreme Court of the Anited States

ALCAN ALUMINUM CORPORATION,

Petitioner.

Vv.

UNITED STATES OF AMERICA:

STATE OF NEW YORK,

Respondents.

On Petition for Writ of Certiorari

to the United States Court of Appeals

for the Second Circuit

BRIEF OF WASHINGTON LEGAL FOUNDATION;

U.S. SENATOR LARRY E. CRAIG;

U.S. REPRESENTATIVES MICHAEL G. OXLEY AND

JOHN M. McHUGH; N.Y STATE SENATOR

JIM WRIGHT; N.Y. STATE ASSEMBLYMAN

WILLIAM A. BARCLAY; OSWEGO CITY

ATTORNEY EDWARD J. IZYK; NEW YORK STATE

CONFERENCE CF MAYORS AND MUNICIPAL

OFFICIALS; OPERATION OSWEGO COUNTY, INC.;

CHAMBER OF COMMERCE OF THE UNITED

STATES; NATIONAL RESTAURANT ASSOCIATION;

AND THE ALLIED EDUCATIONAL FOUNDATION

AS AMICI CURIAE IN SUPPORT OF PETITIONER

DANIEL J. POPEO

PAUL D. KAMENAR

Counsel of Record

WASHINGTON LEGAL FOUNDATION

2009 Massachusetts Ave., NW

Washington, D.C. 20036

(202) 588-0302

December 12, 2003

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

ene eens ees

QUESTION PRESENTED

Whether a company may be subjected to joint and

several liability under the Comprehensive

Environmental Response, Compensation, and Liability

Act (CERCLA) 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.

ill

TABLE OF CONTENTS

Page

OUME S PEPEES 4c ee ws iv

INTERESTS OF AMICI CURIAE............ 1

SUMMARY OF ARGUMENT ............. 4

REASONS FOR GRANTING THE PETITION .... 6

I. THE QUESTION OF WHETHER A COMPANY

CAN BE SUBJECT TO JOINT AND SEVERAL

CERCLA LIABILITY FOR TRACE AMOUNTS

OF ONLY POTENTIALLY HARMFUL

SUBSTANCES IS AN IMPORTANT

QUESTION OF FEDERAL LAW _ THAT

SHOULD BE DECIDED BY THIS COURT ... 6

Il. THE LOWER COURT’S CONCLUSION THAT

THE HARM IS NOT DIVISIBLE RAISES AN

IMPORTANT QUESTION OF CERCLA

are are ar ea eee ee 14

oe 8 a ee 20

iV

TABLE OF AUTHORITIES

Page

Cases:

Acushnet Co. v. Mohasco Corp.,

191 F.3d 69(1st Cir. 1999) ........... A

Allied Signal v. Amcast International Corp.,

177 F. Supp. 2d 713 (S.D. Ohio 2001) ..... 19

Commander Oil Corp. v. Barlo Equip. Corp..,

ihe me KEY fe | 5

Commonwealth of Massachusetts v. Blackstone

Valley Electric Co., 67 F.3d 981 (1st Cir. 1995) 8

In re Bell Petroleum Services, Inc.,

coe Fog: Bk A. rar 15

; Public Citizen v. U.S. Dep’t of Justice,

pe Ses ee CK a eS ae ee es 8

Trans Alaska Pipeline Rate Cases,

ee ee 8. ee aera 8

United States v. Alcan Aluminum Corp.,

990 F.2d 711 (2d Cir. 1993) 2. we ee 7, 10

3 yas Eo me. err rr 5

United States v. Conservation Chemical Co..,

619 F. Supp. 162 (W.D. Mo. 1985) ........ 5

United States v. Hercules, Inc., -

247 F.3d 706 (8th Cir. 2001) ........... 15

United States v. Township of Brighton,

133 F356 U7 Gn Ce. TR) ww we ee ee es 9

Statutes and Regulations:

Comprehensive Environmental Response,

Compensation, and Liability Act (CERCLA),

42 U.SAC. $§ SG01 ef Seg... 2... ee eee passim

TUBA SU 64 SKA ea ee 6,9

‘entire

42 U.S.C. § FOGG) ow i ese eee 6,9

42 U.S.C. 5 POM IGM) 2. wc ce ween 6

SS USA. oes 6 a ee Soe 7

6 UA. BOR vx 6 et kee eee 19

zt Ue © ee 6 oe 0 ee eee 11

Miscellaneous:

Cathleen Clark, Should the Butcher, the Baker and the

Candlestick Maker Be Held Responsible for

Hazardous Waste, 1994 Utah L. Rev. 871

CH) 6 heen eee 8

Comments of the United States on the European

Commission Draft Chemicals Regulation

Cy 3G, GO) 850-445 eee 12

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 (Apr. 26,

MGR. 4 4 0095 ed oe 12

PROSSER & KEATON ON TORTS (Sth Ed. 1984) ... 16

RESTATEMENT (SECOND) OF TORTS,

Seon Cle os eke ee eee ees 15, 17, 18

WASHINGTON PosT, May 17, 2001 .......... 11

(a OORT ETE CLIC A PNET EOL LEE PG * ERK

INTERESTS OF AMICI CURIAE

The Washington Legal Foundation (WLF)' is a non-

profit public interest law and policy center with supporters

nationwide. WLF devotes a significant portion of its

resources to promoting economic liberty, free enterprise

principles, and a limited and accountable government.

WLE regularly appears as amicus curiae in the Supreme

Court and lower federal courts in cases raising important

statutory and constitutional issues, including environmental

and other regulatory cases. See, e.g., United States v.

Bestfoods, Inc., 524 U.S. 51 (1998); United States v.

Hercules, Inc., 247 F.3d 706 (8th Cir. 2001). WLF also

appeared as amicus in the case at bar in the court of

appeals. United States v. Alcan Aluminum Corp., 315 F.3d

179 (2d Cir. 2003) (Alcan II).

U.S. Senator Larry E. Craig is the duly elected

Senator from Idaho and Chairman of the Subcommittee on

Forests and Public Land Management of the Senate Energy

and Natural Resources Committee. Senator Craig appeared

as amicus in Alcan II.

U.S. Representative Michael G. Oxley is the

Representative from the 4th District of Ohio and Chairman

of the House Financial Services Committee. Representative

Oxley formerly chaired the House Subcommittee on Finance

and Hazardous Materials which had direct jurisdiction over

the Superfund program. U.S. Representative John M.

McHugh is the Representative from the 24th District of

Pursuant to Supreme Court Rule 37.6, amici curiae state

than no counsel for a party authored this brief in whole or in part, and

that no person or entity, other than amicus; Washington Legal

Foundation and their counsel, contributed monetarily to the preparation

and submission of this brief. By letters filed with the Clerk of the

Court, the parties have consented to the filing of this brief.

New York which includes Oswego, New York. Both

Representatives appeared as amici in Alcan II.

New York State Senator Jim Wright represents the

48th District of New York. New York State Assemblyman

William A. Barclay represents the 124th Assembly Distiict

of New York. Edward J. Izyk is the City Attorney of

Oswego, New York. These officials represent the

geographical areas that include the area where the

Superfund sites at issue in this case are located.

The New York Conference of Mayors and Other

Municipal Officials is a not-for-profit voluntary association

whose members represent 60 of the State’s 62 cities, as well

as 510 of the State’s 558 villages. The Conference

appeared as amicus curiae in support of Alcan in the related

case in the Third Circuit, United States v. Alcan Aluminum

Corp, 964 F.2d 252 (3d Cir. 1992), and in Alcan II.

The Chaiaber of Commerce of the United States

("the Chamber") is the world’s largest business federation.

The Chamber represents an underlying membership of more

than three million businesses and business organizations,

with 140,000 direct members of every size, in every

business sector, and from every geographic region in the

country. The Chamber regularly advocates its members’

view in court on environmental issues of national concern

to the business community. The Chamber was an amicus

curiae in this case on the first appeal, United States v. Alcan

Aluminum Corp. , 990 F.2d 711 (2d Cir. 1993) (Alcan I), as

well as on the second appeal in Alcan II.

Operation Oswego County, Inc. is a business

development organization in Oswego County, New York.

Its mission is to establish and implement sound economic

development strategies in order to enhance the economic

vitality of Oswego County’s businesses, industries, and

citizens leading to an overall better quality of life. Key to

the mission is the creation and retention of job

opportunities, diversification, and strengthening the local

economic base, and developing the local economy in a

planned, organized, and _ environmentally friendly

atmosphere. Operation Oswego County, Inc. also appeared

as an amicus in A/can II.

The National Restaurant Association is the leading

trade association representing the restaurant industry in the

United States. The Association represents more than

240,000 restaurants, outlets, catering companies, and other

entities. Its member companies have business in every state

as well as in Puerto Rico and the Virgin Islands. Member

companies range from fine-dining restaurants to fast-food

establishments. The decision below raises serious concerns

for the restaurant industry because food and cooking wastes

that are properly disposed in accordance with all laws and

regulations could be deemed to be "hazardous substances"

under CERCLA. The National Restaurant Association also

appeared as an amicus in Alcan I].

The Allied Educational Foundation (AEF) is a non-

profit public policy organization based in Englewood, New

Jersey. Founded in 1964, AEF promotes diverse areas of

study in public policy issues, and has appeared as amicus

curiae along with WLF in numerous cases, and appeared as

amicus in Alcan JI.

All amici, their members, and constituents believe

tha. our environmental laws should be enforced in a fair,

balanced, and reasonable manner as intended by Congress.

The judgment of the court of appeals grossly distorts

congressional intent by imposing strict, joint and several

liability under CERCLA for clean up costs of properly

disposed of wastes that contain, at best, only a trace of a

"hazardous substance. "

Such far-reaching liability exposes businesses,

municipalities and other entities which operate responsibly

in handling and disposing of waste materials to substantial

and unpredictable response costs that are incurred by federal

and state governments. The liability exposure has hampered

and will continue to hamper economic development and

growth, and businesses in the competitive global market will

be less inclined to locate or expand their operations in the

United States. The result will be a loss of jobs and a

decline in the economy, especially in the industrial areas of

the country which are suffering the most.

Moreover, such broad exposure reduces the incentive

for businesses to undertake measures to "clean" their wastes

before disposal if they are going to be held jointly and

severally liable for cleanup costs of Superfund sites,

regardless of the level or concentration of hazardous

substances that are contained in their wastes.

SUMMARY OF ARGUMENT

The Comprehensive Environmental Response,

Compensation, and Liability Act (CERCLA), 42 U.S.C. §§

9601 et seq., was enacted by Congress in 1980 to address

the significant harm to the environment posed by dangerous

and hazardous wastes from abandoned waste sites, such as

Love Canal, as well as those from active sites. A lame-

duck 96th Congress -- far from "carefully formulat[ing]}"

CERCLA’s provisions as the United States suggests (Opp.

12) -- quickly rushed the bill through the legislative process

as one of that body’s last actions, producing what many

courts and commentators have agreed is an

incomprehensible statute with an equally enigmatic

legislative history.”

This case presents the Court with a perfect and rare

opportunity to address and make some sense of an important

and recurring question of federal law, namely, whether

Congress intended under CERCLA that businesses,

municipalities, and other entities could be saddled with

costly and ruinous joint and several liability for cleanup

costs of an entire Superfund site where their non-hazardous

wastes contain trace amounts of an EPA listed hazardous

substance, even if that hazardous substance happens to be

only one molecule of a ubiquitous man-made chemical.

Amici submit that the answer to that question is an emphatic

"no" and that this Court should review and reverse the

erroneous judgment of the court of appeals to the contrary.

Otherwise, the disposal of virtually anything in the

universe, including rainwater, soil, and milk, would trigger

liability under CERCLA.

An important related question is whether the court of

appeals erred as a matter of law by ruling that harm caused

by the release of the hazardous substances from a site

cannot be divisible, and therefore, the response costs cannot

2 See United States v. Conservation Chemical Co., 619 F.

Supp. 162, 204 (W.D. Mo. 1985) (CERCLA is "a hastily assembled

bill and a fragmented legislative history adds to the usual difficulty of

discerning the full meaning of the law."); Commander Oil Corp. v.

Barlo Equip. Corp., 215 F.3d 321 (2d Cir. 2000) ("We are called upon

in this case to resolve yet another ambiguity within CERCLA’s

miasmatic provisions."); United States v. Alcan Aluminum Corp., 964

F.2d 252, 257 (3d Cir. 1994) (CERCLA is "riddled with

inconsistencies and redundancies").

be apportioned, simply because the non-hazardous

components of the waste of a company could spread the

hazardous wastes produced by others. Amici submit that

the court of appeals’ answer to that question also threatens

to expose entities to unfair CERCLA liability, and thus,

should be reviewed and reversed as well.

REASONS FOR GRANTING THE PETITION

I. THE QUESTION OF WHETHER A COMPANY

CAN BE SUBJECT TO JOINT AND SEVERAL

CERCLA LIABILITY FOR TRACE AMOUNTS

OF ONLY POTENTIALLY HARMFUL

SUBSTANCES IS AN IMPORTANT QUESTION

OF FEDERAL LAW THAT SHOULD BE

DECIDED BY THIS COURT

The United States brought this cost recovery action

against Alcan Aluminum Corporation (Alcan) under

CERCLA, 42 U.S.C. § 9607, for the disposal of its

emulsion at two Superfund sites in upstate New York.

Alcan’s emulsion consisted of 95 percent water and 5

percent mineral oil. Significantly, neither the virgin

emulsion as a whole, nor its water and mineral oil

components, are Classified as "hazardous substances" under

(CERCLA), 42 U.S.C. § 9601(14).? Rather, the used

> In its Opposition, the government repeatediy and

misleadingly refers to Alcan’s emulsion as "waste oil emulsion." See,

e.g., Opp. 9-10. Since almost all of Alcan’s emulsion is plain water,

it would be more accurate to refer to Alcan’s substance as a "water

emulsion" rather than the more sinister sounding "waste oil emulsion,"

particularly when the mineral oil component of the emulsion is not a

listed hazardous substance. In any event, amici will simply refer to the

liquid as "emulsion" or "waste emulsion" in their brief which is the

same terminology used by the court of appeals.

emulsion contained traces of certain metal compounds

which, while technically classified as "hazardous

substances" under CERCLA, were essentially harmless

because of their below background levels.

After settling with 82 of the entities which generated

hazardous wastes at the sites, the United States sought to

impose joint and several liability upon Alcan, the only non-

settling party, for the remainder of all the unreimbursed

costs, totalling some $13.6 million.‘

Central to the CERCLA liability scheme, and the

most troubling aspect of this case, is the definition of

"hazardous substance," the release of which triggers the

imposition of strict, joint, and several liability. 42 U.S.C.

§ 9601(14)(B). A literal definition of "hazardous

substance," without any requirement of quanuty,

concentration, or toxicity, would apparently cover "any

element, compound, mixture, solution, or substance"

designated by the EPA, however benign. Under this broad

definition, "hazardous substances" would be found in, and

thus include, breakfast cereal, garden soil, milk, and other

life-supporting substances. See United States v. Alcan

Aluminum Corp., 990 F.2d 711, 716 (2d Cir. 1993) (Alcan

I); Opp. 4, n.1 (citing cases).

Congress clearly did not intend that almost

* While the statute is silent on the issue, most lower courts

have construed CERCLA to impose strict (and retroactive) liability

upon so-called "responsible parties" and to impose joint and several

liability for the entire harm and response costs, but only if the harm

from the release of hazardous substances is not divisible. See Opp. 5

(citing cases). If the harm is divisible, then liability is apportioned on

a reasonable basis rather than jointly and severally. Amici address the

divisibility issue in Point II, infra.

everything in the universe would be a "hazardous"

substance. "There is nothing to suggest that Congress

intended to impose far-reaching liability on every party who

is responsible for only trace levels of waste. Several

courts. . . have rejected the notion that CERCLA liability

‘attaches upon release of any quantity of a hazardous

substance.’" Acushnet Co. v. Mohasco Corp., 191 F.3d 69,

78 (Ast Cir. 1999) (citations omitted).

A basic canon of statutory interpretation is that

courts should interpret statutes to avoid absurd results. See,

e.g., Trans Alaska Pipeline Rate Cases, 436 U.S. 631, 643

(1978); Public Citizen v. U.S. Dep’t of Justice, 491 U.S.

440, 454 (1989) ("Where the literal reading of a statutory

term would ‘compel an odd result, * * * we must search for

other evidence of congressional intent to lend the term its

proper scope."); Commonwealth of Massachusetts v.

Blackstone Valley Electric Co., 67 F.3d 981 (1st Cir. 1995)

(court rejected broad definition of "cyanide" as hazardous

substance since it would include everyday substances such

as vitamin B-12 and lead to "nonsensical results").° As

petitioner correctly notes, whether a substance is truly

hazardous or not depends upon the concentration and dose

of the substance. Pet. 7.

Acknowledging the force of these arguments by

Alcan and its amici, the Second Circuit, instead of

interpreting the definition of "hazardous substance"

narrowly to comport with the intent of Congress,

nevertheless crafted what it called a "special exception" to

the liability standard that would essentially accomplish the

° See Cathleen Clark, Should the Butcher, the Baker and the

Candlestick Maker Be Held Responsible for Hazardous Waste, 1994

Utah L. Rev. 871, 916 (1994).

a

same result. Thus, in Alcan I, the court of appeals held that

a defendant such as Alcan could "escape payment where its

pollutants did not contribute more than background

contamination and also cannot concentrate." 990 F.2d at

722. In doing so, the court’s "special exception" implicitly

acknowledges the fact that disposing substances, mixtures,

or solutions that contain only background levels of a listed

hazardous substance does not cause the incurrence of

response costs.°

Yet on remand to the district court, Alcan was

deemed not even eligible for the special exception because

the district court made new findings based on circumstantial

and questionable evidence that Alcan’s otherwise non-

hazardous emulsion contained some _ polychlorinated

biphenyls (PCBs). The court of appeals determined in

Alcan’s second appeal that this finding was dispositive for

jettisoning its previous below-background exception for the

following reason:

The finding that Alcan’s waste emulsion contained

PCBs is particularly significant because -- as the

district court properly ruled -- it disqualifies Alcan

from escaping all CERCLA liability. See Alcan-

Consolidated, 97 F. Supp. 2d at 268-59. The

"special exception" that we created when this case

was previously before us was intended to excuse a

responsible party from all CERCLA liability only in

instances where (1) a party contributed hazardous

° Gf. United States v. Township of Brighton, 153 F.3d 307,

319 & n.14 (6th Cir. 1998) (defendants who are not responsible for

any of the harm "have effectively fixed their own share of the damages

at zero. No causation means no liability, despite § 9607(a)’s strict

liability scheme.").

10

substances to a site in quantities that did not exceed

background levels and (2) the hazardous substances

were incapable of concentrating. See Alcan, 990

F.2d at 722. We created this exception based on an

awareness that some CERCLA hazardous

substances, like metals, occur in the environment

naturally. The narrow exception carved out was

aimed 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, and did not themselves

trigger the incurrence of response costs. Because

Alcan’s emulsion was contaminated with PCBs,

which are man-made substances without natural

background levels, Alcan cannot escape liability

under the special exception this court articulated.

Pet. App. 10a. The court of appeals completely gutted its

below-background exception based on the wholly arbitrary

and artificial distinction between background levels of

natural hazardous substances and manmade hazardous

substances such as PCBs. In short, the court of appeals

concluded with the urging of the government that a

background level of PCBs is zero; anything above that level

subjects an entity to joint and several liability. |

Because of the ubiquitous presence of PCBs in the

environment, virtually every non-hazardous substance

automatically becomes a hazardous substance simply by

being exposed to the air where PCBs can be found. If left

intact, the court of appeals ruling threatens to expose

entities to costly and ruinous liability for cleanup costs of a

Superfund site simply because they lawfully disposed of

otherwise benign non-hazardous waste at sites or landfills as

11

directed by the government authorities.

The inescapable and unrefuted fact is that PCBs have

background levels in the natural environment -- in the air, '

water, and soil. PCBs are ubiquitous and can be found in

such pristine areas such as the Arctic.’ As Alcan poignantly

noted, the Food and Drug Administration (FDA) has even

set allowable levels of PCBs that contaminate our food and

food packaging. Pet. at 9 (citing to 21 C.F.R. § 109.30)

(reproduced hereto as an Appendix to amici’s brief).

Notably, the FDA regulation -- which falls within Subpart

B entitled "TOLERANCES FOR UNAVOIDABLE

POISONOUS OR DELETERIOUS SUBSTANCES" --

recognizes that PCBs are "toxic, industrial chemicals

[which] have become a persistent and ubiquitous

contaminant in the environment." Jd. (emphasis added).

The FDA has set acceptable and tolerable limits of PCBs

that contaminate our milk, poultry, eggs, fish, and even

"infant and junior foods." 21 C.F.R. § 109.30(a)(1)-(9)

(emphasis added). Amici App. 2a. In short, while the

government deems it safe for infants to eat PCB

contaminated food, disposing of that same food or other

wastes which may contain even Jess of a concentration or

amount of PCBs, subjects the entity to costly joint and

several liability for discharging a "hazardous substance."

The government’s feeble response to that absurd

result is that the FDA "does not purport to ‘establish

permissible ‘background’ levels of PCBs for purposes of

7’ See Washington Post, May 17, 2001, at Al7 (PCBs travel

naturally in “ocean currents, or in the winds, falling in places where

they have never been used * * * . More than 6 tons of PCBs reach the

Arctic each year this way."). Thus, while PCBs are synthetic, they

have a "natural" background level.

12

CERCLA response action." Opp. 15, n.4. But what the

government does not and cannot address or recognize is that

PCBs, because they are ubiquitous, have background levels

in the environment. Accordingly, there is no reason in the

law or logic to impose CERCLA liability upon an entity

that merely disposes of a non-hazardous substance such as

water, simply because it may contain, and most certainly

does contain, a harmless PCB molecule.

Further undercutting the position of both the court

and the government in this regard is EPA’s own

remediation policy that, as Alcan noted (Pet. 9), recognizes

that both natural and many manmade pollutants have

background levels above zero, and, hence, do not require

cleanup. 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). Otherwise, an

EPA ordered cleanup would result in the site being cleaner

than the surrounding natural area. Here too, the

government feebly responds by claiming that the

background levels of PCBs that may be taken into account

are those that are "present as a result of human activity but

not specifically related to the CERCLA release in question."

Opp. 15, n.4.

Both of these non-responses simply illustrate the

bankruptcy of the government and lower courts’ positions.®

® The United States position in this case also appears to

conflict with its position before the European Commission on the EU’s

draft chemical regulation. In its comments to the EU, the United

States complained that the draft regulation “appears to adopt a

particularly costly, burdensome, and complex approach, which could

prove unworkable in its implementation, adversely impact innovation

and disrupt global trade." Comments of the United States on the

13

In short, unless the Second Circuit is overturned on this

score, the disposal of liquid or solid wastes by

manufacturers, or food and food packaging materials by

restaurants, which already contained trace amounts of PCBs

before the waste was disposed, exposes the businesses to

Strict, joint, and several liability.

The decision below is not only contrary to law, but

also contrary to sound public policy. Unless overturned or

revised, the decision would discourage companies from

incurring expenses and developing technology to reduce the

level of hazardous substances in their wastes before

disposal. If a company is going to be held strictly, jointly,

and severally liable for the cleanup costs of the wastes from

other entities, regardless of the relative toxicity of its own

wastes, the company would have little or no incentive to

develop methods and technology to "clean" its wastes before

disposal.

Under the Second Circuit’s rationale, if Company A

disposes 1,100 gallons of clean wastewater containing only

trace levels of PCBs at a waste site that already contains

110 gallons of heavily concentrated PCBs disposed of by

Company B, Company A could be held liable for up to 100

percent of any cleanup costs, even though the real polluter

could be not liable at all (due to the 2002 amendment to

CERCLA exempting up to 110 gallons of liquid waste from

liability, 42 U.S.C. § 9607(0)), or only liable for as little as

one percent of the costs based solely on volumetric ratios.

European Commission Draft Chemicals Regulation (July 10, 2003) at

2. In particular, the U.S. expressed concern that regulation should not

focus on chemicals that have "low intrinsic hazard" or "low exposure

potential." Rather, resources "should focus on chemicals . . . likely

to pose the greatest health and environmental risks." Jd. at 3.

14

This unfair result would obtain even though the

concentrated PCBs from Company B became diluted and

less harmful, thanks to Company A’s cleaner water.

Imposing CERCLA liability in cases such as this is

patently unfair, unpredictable, and uninsurable. Amici local

governments and municipalities which provide waste

collection and disposal services for their citizens are

exposed to joint and several liability for any cleanup costs

at a disposal site since all trash, food remains, paper,

vitamins, cereal, and even leaves and lawn clippings could

be considered "hazardous substances" under the lower

court’s opinion and not be eligible for the limiting special

exception. In short, the decision of the lower courts in this

case violated the intent of the Congress that "polluters pay"

for the remediation costs.

Il. THE LOWER COURT’S CONCLUSION

THAT THE HARM IS NOT DIVISIBLE

RAISES AN IMPORTANT QUESTION

OF CERCLA LIABILITY

Even assuming, arguendo, that Alcan could not

escape liability altogether because there is no permissible

background level for PCBs, and that the presence of one

PCB molecule in water will suffice to impose joint and

several liability for cleanup costs, the court of appeals --

reiterating language from its earlier decision in Alcan I --

stated that Alcan could nevertheless limit the extent of its

liability by showing that it "contributed at most to only a

divisible portion of the harm." Pet. App. 8a.

Far from being a "fact-specific challenge" to the

court of appeals ruling on the issue of divisibility as the

government suggests (Opp. 18), the initial question of

15

whether a harm is divisible is a pure question of law that is

reviewed de novo. In re Bell Petroleum Services, Inc., 3

F.3d 889, 902 (Sth Cir. 1993); United States v. Hercules,

Inc., 247 F.3d 706, 718 (8th Cir. 2001). Here, both the

district court and court of appeals stumbled badly and erred

as a matter of law in determining that the harm was not and

could never be divisible, regardless of the PCB levels that

may have been in the emulsion. Accordingly, amici submit

that review by this Court is warranted in order to provide

much needed guidance to the Second Circuit and other

lower courts on the proper application of common law

principles of apportionment of harm and divisibility as

reflected by the Restatement (Second) of Torts, §433A

(1965).?

The court of appeals purported to justify its finding

of no divisibility as follows:

Our conclusion that Alcan is jointly and severally

liable for the harm caused at PAS and Fulton is

based upon the district court’s finding that

* * * Alcan’s emulsion contributed to the

breadth of contamination at both PAS and

Fulton. In other words, even if the

hazardous substances in Alcan’s emulsion

themselves did not contribute to the response

costs at the sites (which the PCBs and nickel

did), the emulsion as a whole contributed to

° § 433A. Apportionment of Harm to Causes

(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.

16

both the release and response costs.

Pet. App. 12a-13a, citing Alcan-Consolidated, 97 F. Supp.

2d at 270 (emphasis added). But this facile conclusion

simply begs the question: was the harm nevertheless

divisible or subject to reasonable apportionment under the

Restatement and common law principles? Putting aside the

reasonable notion that Alcan’s emulsion may have actually

diluted the hazardous substances disposed of by others at the

site, and thus, ameliorated any environmental harm, the

court’s rejection of any divisibility of harm as a matter of

law has enormous consequences for businesses.

The government struggles vainly to defend the faulty

reasoning of the court of appeals by noting that after all, the

non-hazardous water and mineral oil which moved other

hazardous substances contained the ubiquitous PCBs

(regardless of the amount), and that technically speaking,

this mixture "in itself, qualified as a hazardous substance"

(Opp. 20), even though the PCBs themselves had absolutely

nothing to do with the emulsion spreading the waste. Amici

submit that the presence of a trace "hazardous substance" in

Alcan’s or anyone else’s benign emulsion or waste cannot

be the bootstrap or trigger that imposes massive multi-

million dollar joint and several liability.

The district court went astray with its tortured and

result-oriented application of the Restatement to show there

can be no divisibility by citing only to certain gun

hypotheticals from Prosser & Keaton on Torts (Sth Ed.

1984) that discuss only indivisible harm. Pet. App. 54a.'°

” {T]he conduct of multiple tortfeasors need not be

simultaneous to cause an indivisible harm, "“[o]ne

defendant may create a situation upon which the other

17

These gun hypotheticals are clearly distinguishable

from this case, and not surprisingly, were not discussed, let

alone cited with approval, by either the court of appeals or

the government. The "single gun" example is clearly

inapposite here since there are multiple sources of the

pollution in this case. The “separate guns" example fails

too because that scenario contemplates only one final result

from the shooting: death."

The Restatement is replete with more apt pollution

scenarios that call for divisibility and apportionment; the

courts below ignored these more relevant scenarios. As the

Restatement notes, "apportionment is commonly made in

cases of private nuisance, whether the pollution of a stream,

or flooding, or smoke or dust or noise, from different

sources, has interfered with the plaintiff's use or enjoyment

of his land." § 433A, cmt. d. (emphasis added).

may act later to cause damage." [Prosser] at 348.

For example, "[i]f two defendants, struggling for a

single gun, succeed in shooting the plaintiff; there is

no reasonable basis for dividing the liability." Jd. at

345. Moreover, if two defendants shoot the plaintiff

"independently, with separate guns, and the plaintiff

dies from the effect of both wounds, there can still be

no division." /d.

Pet. App. 54a.

'! As the Restatement is careful to note, "[c]ertain kinds of

harm, by their very nature, are normally incapable of any logical,

reasonable, or practical division. Death is that kind of harm, since it

is impossible. . . to say that one man has caused half of it and another

the rest." Restatement § 433A, cmt. on subsec.(2)(i). In this case, the

environment at the PAS and Fulton sites may have been wounded or

harmed, but it certainly was not "killed" or completely destroyed.

18

Ignoring the Restatement’s pollution examples, and

relying instead on the inapt gun/death hypotheticals, the

district court came to the erroneous conclusion that "where

two independent causes combine to cause an aggregate harm

which exceeds the sum of the individual harms such that the

harm attributable to each PRP becomes indistinguishable,

the harm is not divisible." Jd. Pet. 54a-55a (emphasis

added). In fact, nothing in the Restatement or common law

suggests that divisibility can never be established simply

because the aggregate harm may exceed the sum of the

individual harms. Nor is divisibility precluded even if the

harm "attributable to each PRP becomes indistinguishable."

The court’s fundamental error was that it ignored the more

relevant single harm/divisibility principle of Restatement §

433A(1)(b). Simply put, divisibility does not require the

court to "distinguish" or "fingerprint" each harm and match

it to a particular PRP in order for the harm to be divisible.

See Restatement (Second) of Torts, § 881, illus.2.

In the case at bar, there is no question that what

"drove" the remediation was the presence of numerous and

distinct chemicals which were either not in Alcan’s

emulsion, or at below background levels. Nevertheless, the

district court maintained that "even taking Alcan’s

proposition that its waste contained only oil, water, and

background metals as true [that is, assuming that the

emulsion is non-hazardous], the Court cannot conclude that

the emulsion did not contribute to the release and clean-up

costs at PAS." Pet. App. 55a-56a, n.30. Under this

reasoning, CERCLA liability is not only strict, but it has

become absolute, and thus far beyond Congress’s original

intent that the polluter should pay. As Alcan aptly

observed, the court of appeals ruling in this regard

"threatens to blow the limits off CERCLA liability

entirely." Pet. 13.

"eee

|

19

Even assuming the worst-case scenario that this was

exclusively a PCB Superfund site, the court should have

considered the relative toxicity of Alcan’s emulsion in

apportioning costs. A good example of this is found in

Allied Signal v. Amcast International Corp., 177 F. Supp.

2d 713 (S.D. Ohio 2001), where the court apportioned

clean up costs using a relative toxicity analysis.’ In Allied

Signal, the court found that both the plaintiff and defendant

had dumped PAHs, a hazardous substance not unlike PCBs,

at the site in question, and had produced a single harm

necessitating response costs.

Evidence was introduced showing that the plaintiff

was responsible for 72% of the total waste volume at the

site, and that the defendant was responsible for 28%.

Apropos to the case at bar, the Allied Signal court noted

that the defendant’s waste was "overwhelmingly composed

of inorganic sand" [compare to Alcan’s non-hazardous

water and mineral oil] and thus "largely non-toxic." Jd. at

752. Accordingly, the court properly rejected the

volumetric ratio of 28% and relied on testimony showing

that the relative amount of the PAHs in the defendant’s

waste -- since it was the presence of PAHs that drove the

remediation -- to be only in the 2-3% range. Although the

court agreed with the plaintiff that since the wastes were

mixed or commingled, it was impossible to determine

whose PAH actually contaminated the groundwater, the

court was nevertheless able to make a fair apportionment of

'2 While the apportionment of liability in Allied Signal was

done in the context of a 42 U.S.C. § 9613(f) contribution action

applying certain equitable factors, the relative toxicity factor is

essentially identical to the relative toxicity factor that the court of

appeals indicated in Alcan / is available to a defendant in a cost

recovery suit under § 9607 to eliminate or limit its liability.

20

the costs based on the evidence.

In the case at bar, the courts below did not find the

harm divisible at all, neither at the volumetric level, nor at

the more appropriate toxicity level. Even accepting the

district court’s finding that Alcan’s emulsion contained

PCBs, the evidence proffered showed that Alcan’s

contribution of PCBs would have been only .01% of the

PCBs from all other known sources, and that the total

amount of PCBs constituted only 0.24% of all the

hazardous wastes at this site. Pet. 12. Accordingly, at

best, Alcan’s fair share of liability should be but a fraction

of the $13.6 million imposed. The government’s attempt to

challenge Alcan’s evidence in this Court now (Opp. 19) is

without merit, comes way too late, and in any event, is

irrelevant, because the court below imposed joint and

several liability regardless of PCB levels in the emulsion.

CONCLUSION

In retrospect, the court of appeals in Alcan J sent the

petitioner on a costly and time-consuming fool’s errand

back to the district court to show divisibility; in the process,

both courts revealed in their subsequent decisions just how

foolish and absurd their interpretation of CERCLA’s reach

can be. Because of the inordinate liability and litigation

costs associated with defending CERCLA cases, and

considering that more than 15 years has been consumed in

litigating this case to refine the issues, it is unlikely that the

Court will ever again have this rare opportunity to address

the important issues presented in this case having such far-

reaching consequences.

For the foregoing reasons, this Court should grant

the petition for certiorari.

Respectfully submitted,

DANIEL J. POPEO

PAUL D. KAMENAR

Counsel of Record

WASHINGTON LEGAL FOUNDATION

2009 Massachusetts Ave., N.W.

Washington, D.C. 20036

(202) 588-0302

Date: December 12, 2003