REFINED METALS CORPORATION v. NL INDUSTRIES, INC.

Filing 27

ORDER - granting 10 Motion to Dismiss; Counts I and II of the complaint are DISMISSED WITH PREJUDICE as precluded and untimely. Counts III and IV of the complaint are DISMISSED WITHOUT PREJUDICE for lack of jurisdiction. Final judgment will be entered by separate document. Fed. R. Civ. P. 58(a). Signed by Judge Sarah Evans Barker on 9/25/2018. *** SEE ENTRY *** (CKM)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
REFINED METALS CORPORATION,

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Plaintiff,
v.
NL INDUSTRIES, INC.,
Defendant.

No. 1:17-cv-02565-SEB-TAB

ORDER ON DEFENDANT’S MOTION TO DISMISS COMPLAINT (DKT. 10)
This is an action for cost recovery and contribution under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42
U.S.C. § 9601 et seq., as amended by the Superfund Amendments and Reauthorization
Act of 1986 (SARA), Pub. L. No. 99-499, 100 Stat. 1613, brought by Refined Metals
(“Refined”), a Delaware corporation, against NL Industries (“NL”), a New Jersey
corporation. There are also state claims for common law indemnity and cost recovery
under Indiana’s Environmental Legal Actions statute (“ELA Statute”), Ind. Code ch. 1330-9. NL has moved to dismiss the complaint, see Fed. R. Civ. P. 12(b)(6), chiefly on
timeliness grounds.
For the reasons explained below, the motion is granted.
Background
The complaint alleges as follows. From 1968 until 1980, NL operated a lead
reclaiming facility (“the Facility”) at a site in Marion County, Indiana (“the Property”). In

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1980, NL sold the Property and the Facility to Refined, which operated the Facility until
1995 and continues to own the Property.
In 1990, the United States government, on behalf of the U.S. Environmental
Protection Agency (EPA), filed a complaint in this Court before the undersigned judge
seeking remediation of ground- and air-pollution caused by the Facility’s smelting
operations. The Indiana Department of Environmental Management (IDEM) intervened
as a party plaintiff.
In 1998, Refined, the United States, and IDEM, “having recognized that
settlement of this matter [was] in the public interest,” tendered a proposed consent decree
(“the 1998 Consent Decree”) “in order to compromise and settle the claims stated in the
Complaint against [Refined] without further litigation[.]” Dkt. 12 Ex. A, at 4; also No.
IP90-C-2077-B/S, Dkt. 529. We consider here the 1998 Consent Decree in connection
with NL’s Rule 12(b)(6) motion without converting it to a motion for summary judgment,
see Fed. R. Civ. P. 12(d), because the 1998 Consent Decree is referred to in the complaint
and central to Refined’s claims, see Williamson v. Curran, 714 F.3d 432, 436 (7th Cir.
2013), and because we may take judicial notice of our own docket. See id.; Griffin v.
United States, 109 F.3d 1217, 1219 n.1 (7th Cir. 1997).
In parts relevant here, the 1998 Consent Decree provided as follows: Among
others, one of its purposes was for Refined “to recommend a final corrective measure[]
for [the Facility] necessary to protect human health and the environment” and to
“perform the final corrective measure[] as required by [EPA][.]” Dkt. 12 Ex. A, at 13.
Refined was not required to and did not admit liability. But Refined was required to close
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the Facility; investigate, propose, and implement a plan of remediation for the Property;
and pay a $210,000 fine.
“In consideration of the actions that [were to be] performed and the payments that
[were to be] made by [Refined] . . . ,” the United States “covenant[ed] not to sue or to
take administration action against [Refined]” under applicable provisions of the Resource
Conservation and Recovery Act of 1976 (RCRA), 42 U.S.C. § 6901 et seq., and the
Clean Air Act of 1963 (CAA), 42 U.S.C. § 7401 et seq. Dkt. 12 Ex. A, at 37. IDEM
“covenant[ed] not to sue or to take administrative action against [Refined] for violations
alleged in [Indiana’s] Complaint.” Id. at 37–38. The United States “expressly reserve[d]”
its rights to proceed against Refined under CERCLA, and IDEM “expressly reserve[d]”
its rights to proceed under Indiana’s superfund-type law, now codified at Ind. Code ch.
13-25-4.
The 1998 Consent Decree was to terminate once Refined and EPA concurred that
Refined had fully complied with its terms and filed a joint motion for termination in this
Court. No motion for termination having been filed, see No. IP90-C-2077-B/S, Dkt., the
decree appears to be in full force still.
Refined submitted the results of its initial investigation to EPA in 2000. The final
investigation report was submitted in 2003. A proposed remedy for the Property was
approved by EPA following public notice and comment in 2009. The final remedial
design was approved by EPA in 2014. “Refined began the onsite remedy implementation
on August 4, 2014. The work has been completed, subject to final approval from EPA.”
Compl. ¶ 27. This action was filed on July 28, 2017.
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Standard of Decision
A motion to dismiss for failure to state a claim on which relief can be granted tests
the legal sufficiency of the complaint. McReynolds v. Merrill Lynch & Co., Inc., 694 F.3d
873, 879 n.4 (7th Cir. 2012). A complaint is sufficient where it gives a short, plain
statement showing the pleader is entitled to relief. Fed. R. Civ. P. 8(a)(2). The complaint
must raise the right to relief above a speculative level by pleading claims that are
plausible on their face, with all factual allegations taken as true. Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007)).
Though statutes of limitations are affirmative defenses which the complaint need not
anticipate or plead around, an action may be dismissed as untimely if the pleadings
themselves “set forth everything necessary to satisfy the affirmative defense.” Chi. Bldg.
Design, P.C. v. Mongolian House, Inc., 770 F.3d 610, 614 (7th Cir. 2014) (internal
quotation marks, citation omitted).
I. The CERCLA Claims Are Precluded and Untimely (Counts I, II)
Refined seeks to recover here against NL under CERCLA Sections 107(a) and
113(f). We conclude that only the latter section is available to it, but even that claim is
time-barred. The CERCLA claims must therefore be dismissed with prejudice.
A. Statutory Background
We begin with an overview of the applicable statutory provisions. “Response” is
defined at 42 U.S.C. § 9601(25) as “removal, remedy, and remedial action[,] . . .
includ[ing] enforcement activities related thereto.” “Remedy” and “remedial action” are
defined at 42 U.S.C. § 9601(24) as
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those actions consistent with permanent remedy taken instead
of or in addition to removal actions in the event of a release or
threatened release of a hazardous substance into the
environment, to prevent or minimize the release of hazardous
substances so that they do not migrate to cause substantial
danger to present or future public health or welfare or the
environment.
A nonexclusive list of “remedies” follows. In contrast to the permanency of a CERCLA
“remedy,” “removal” is defined at 42 U.S.C. § 9601(23) as an immediate temporary or
emergency measure. Under CERCLA, then, “removals” are short-term measures,
“remedies” are long-term measures, and “responses” include both.
CERCLA provides two distinct mechanisms for the recoupment of response costs
at Sections 107(a) and 113(f), respectively. United States v. Atl. Research Corp., 551
U.S. 128, 131 (2007). The actions under these sections are mutually exclusive. NCR
Corp. v. George A. Whiting Paper Co., 768 F.3d 682, 691 (7th Cir. 2014); Bernstein v.
Bankert, 733 F.3d 190, 206 (7th Cir. 2013). If the statutory trigger for a Section 113(f)
action is met, the plaintiff must proceed under that section and cannot proceed under
Section 107(a). NCR, 768 F.3d at 690–91; Bernstein, 733 F.3d at 204–06. The actions
“are governed by different statutes of limitation, and we must decide under which section
[Refined’s] CERCLA claim falls before determining whether it is time-barred.”
Bernstein, 733 F.3d at 200.
“Section 107(a) defines four categories of [potentially responsible parties, or]
PRPs, and makes them liable for, among other things:
‘(A) all costs of removal or remedial action incurred by the
United States Government or a State or an Indian tribe

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not inconsistent with the national contingency plan;
[and]
‘(B) any other necessary costs of response incurred by any
other person consistent with the national contingency
plan.’”
Atl. Research, 551 U.S. at 131–32 (internal citation omitted) (first alteration added)
(quoting 42 U.S.C. §§ 9607(a)(4)(A)-(B)). In Atlantic Research, the Supreme Court held
that Subsection (B) quoted above “grants one PRP the same rights as an innocent party to
sue another PRP for cleanup costs incurred in a removal or remedial action.” Bernstein,
733 F.3d at 201.
A Section 107(a) cost recovery action “must be commenced—
(A) for a removal action, within 3 years after completion of
the removal action . . . ; and
(B) for a remedial action, within 6 years after initiation of
physical on-site construction of the remedial action,
except that, if the remedial action is initiated within 3
years after the completion of the removal action, costs
incurred in the removal action may be recovered in the
cost recovery action brought under this subparagraph.”
42 U.S.C. §§ 9613(g)(2)(A)-(B).
“Enacted as part of [SARA],” Section 113(f) “authorizes one PRP to sue another
for contribution in certain circumstances.” Atl. Research, 551 U.S. at 132 (citing 42
U.S.C. § 9613(f)). There are “two distinct rights to contribution, each subject to its own
prerequisites.” Bernstein, 733 F.3d at 201. The first, under Section 113(f)(1), is not
relevant here. See id. The second is established by Section 133(f)(3)(B), which provides
that

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[a] person who has resolved its liability to the United States
or a State for some or all of a response action or for some or
all of the costs of such action in an administrative or
judicially approved settlement may seek contribution from
any person who is not party to a settlement referred to in
paragraph (2).
42 U.S.C. § 9613(f)(3)(B). A Section 133(f)(3)(B) contribution claim “is only available to
a person who has ‘resolved its liability . . . in an administrative or judicially approved
settlement.’” Bernstein, 733 F.3d at 202 (original ellipsis).
No Section 133(f) contribution action “for any response costs or damages may be
commenced more than 3 years after—
(A) the date of judgment in any action under this chapter for recovery of
such costs or damages, or
(B) the date of . . . entry of a judicially approved settlement with respect to
such costs or damages.”
42 U.S.C § 9613(g)(3)(A)-(B).
In sum, as relevant here, a Section 107(a) cost recovery action, which arises when
a person incurs necessary costs of response, 42 U.S.C. § 9607(a)(4)(B), is limited by
Section 113(g)(2) to three years “after completion of [a] removal action” and six years
“after initiation of physical on-site construction of [a] remedial action[.]” Id. §§
9613(g)(2)(A)-(B). A Section 113(f) contribution action, which arises when a person
resolves its liability to the United States or a state for some or all of a response action or
the costs of such action in a judicially approved settlement, id. § 9613(f)(3)(B), is limited
by Section 113(g)(3) to three years after “the date of . . . a judicially approved settlement
with respect to [any response] costs or damages.” Id. § 9613(g)(3)(B).
B. Application of Statutory Limitations Periods to Case at Bar
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In this case, NL argues: (1) the 1998 Consent Decree gave rise to a Section 113(f)
contribution claim because it was a judicially approved settlement that resolved Refined’s
liability to the United States and Indiana for some or all of a response action; (2) the
accrual of a Section 113(f) contribution claims bars a Section 107(a) cost recovery claim;
(3) the three-year limitations period for contribution arising from the 1998 Consent
Decree lapsed in 2001; and (4) any CERCLA claim Refined seeks to advance now is
therefore untimely and must be dismissed.
Refined counters that (1) the 1998 Consent Decree did not cause a Section 113(f)
contribution claim to accrue because the settlement resolved liability only under RCRA
and the CAA, while EPA’s rights under CERCLA and IDEM’s rights under the state
superfund law were expressly reserved; (2) the limitations period on a contribution claim
either (a) has not yet begun to run and will not begin to run until judicial resolution of
CERCLA liability, either by adjudication or by construction of the 1998 Consent Decree,
making Refined’s a “reasonable” “protective claim,” Br. Opp. 13, or (b) began to run
within the last three years when work at the Property was completed; and (3) in any
event, its complaint sufficiently states a timely Section 107(a) cost recovery claim,
“subject to any contribution counterclaim which may be filed.” Id.
Because a Section 113(f) contribution claim knocks out a Section 107(a) cost
recovery claim, we begin by asking whether Refined has a Section 113(f) claim against
NL. A complaint does not state a claim on which relief can be granted before the claim
has accrued. Cole v. Lashbrook, No. 18 C 50022, 2018 WL 1014512, at *1 (N.D. Ill. Feb.
22, 2018); Perry v. Indiana, No. 1:09-cv-018-DFH-TAB, 2009 WL 659179, at *2 (S.D.
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Ind. Mar. 11, 2009) (Hamilton, J.). Refined cites no authority for its assertion that
“reasonable protective claims” may be heard and decided under CERCLA. Accordingly,
dismissal is in order if either the claim has accrued but has been untimely brought, or has
not yet accrued. The only difference in disposition would be dismissal with prejudice in
the former case or without prejudice in the latter case. See Perry, 2009 WL 659179, at *2.
We consider first whether accrual of a Section 113(f)(3)(B) claim requires
resolution of liability under CERCLA specifically. An affirmative answer means no such
claim has yet accrued, because the 1998 Consent Decree expressly reserved EPA’s
CERCLA rights. Concluding, however, that the answer is negative, we consider next
whether the 1998 Consent Decree “resolved” Refined’s liability within the meaning of
Section 113(f)(3)(B).
1. Resolution of CERCLA Liability Is Not Required to Trigger §
113(f)(3)(B)
The Seventh Circuit has not yet spoken to whether Section 113(f)(3)(B) requires
resolution of CERCLA liability specifically. The Third and Ninth Circuits have
concluded it does not. Asarco LLC v. Atl. Richfield Co., 866 F.3d 1108, 1119–21 (9th Cir.
2017); Trinity Indus., Inc. v. Chi. Bridge & Iron Co., 735 F.3d 131, 136–38 (3d Cir.
2013). The Second Circuit has concluded that it does. Consol. Edison Co. of N.Y. v. UGI
Utils., Inc., 423 F.3d 90, 95 (2d Cir. 2005). We agree with the majority view.
In Asarco, where, as here, the contribution seeker had settled RCRA but not
CERCLA liability, the Ninth Circuit pointed to Section 113(f)(1), the “companion
provision” to Section 113(f)(3), which “expressly requires a CERCLA predicate” for

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claim accrual. 866 F.3d at 1118 (citing 42 U.S.C. § 9613(f)(1)). “‘Where Congress
includes particular language in one section of a statute but omits it in another section of
the same Act, it is generally presumed that Congress acts intentionally and purposely in
the disparate inclusion or exclusion.’” Id. at 1118–19 (quoting Russello v. United States,
464 U.S. 16, 23 (1983)). The Ninth Circuit further found its approach “consistent with
CERCLA’s broad remedial purpose” as well as “with EPA’s own view” of the statute. Id.
at 1119.
In Trinity Industries, the Third Circuit noted that “the plain language of the statute
itself” contained no CERCLA-specific requirement. 735 F.3d at 136. That court relied
further on its prior decision in United States v. Rohm & Haas Company, 2 F.3d 1265 (3d
Cir. 1993), also a case in which the contribution seeker had settled RCRA but not
CERCLA liability, where the court “located ‘no support in the text or legislative history
of CERCLA for the suggestion that identical oversight activity on the part of the
government should be considered a removal if the government invokes CERCLA, but not
a removal if other statutory authority is invoked.’” Trinity Indus., 735 F.3d at 137
(quoting Rohm & Haas, 2 F.3d at 1275).
Both the Ninth and Third Circuits reasoned that the Second Circuit’s contrary
holding in Consolidated Edison rested on a flawed reading of the legislative history,
Asarco, 866 F.3d at 1120; Trinity Indus., 735 F.3d at 136, and both courts noted that the
Second Circuit may now in fact be retreating from its approach. Asarco, 866 F.3d at
1120; Trinity Indus., 735 F.3d at 137–38. Here, in opposition to the Ninth and Third
Circuits’ persuasive readings of CERCLA’s text, structure, and purpose, Refined offers
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no good reason to align ourselves with a minority position of doubtful vitality.
Accordingly, we hold that 1998 Consent Decree need not have resolved CERCLA
liability specifically in order to cause accrual of a Section 113(f)(3)(B) action.
2. The 1998 Consent Decree “Resolved” Refined’s Liability
We move next to determining whether the 1998 Consent Decree “resolved”
Refined’s liability within the meaning of Section 113(f)(3)(B). The Seventh Circuit’s
decisions in Bernstein and NCR confronted the same question. In Bernstein, the court
emphatically rejected defendants’ position that “resolving” liability by settlement is
equivalent to “entering into” a settlement. 733 F.3d at 210. Rather, “resolution”
“involve[s] the concept of a conclusive determination of some kind. . . . [C]ourts consider
liability to be ‘resolved’ when the issue of liability is decided, in whole or in party, in a
manner that carries with it at least some degree of certainty and finality.” Id. at 211–12.
Before the Bernstein court was an administrative order by consent (AOC or
“consent order”) between plaintiff contribution seekers and EPA. In finding that the
consent order did not “resolve” liability, the court pointed to two elements of the order.
First, the consent order provided that it did not “constitute any admission of liability” by
the contribution seekers. Id. at 212. Second, though the contribution seekers had
promised in the consent order to “perform certain removal actions, the EPA only
conditionally promised to release [them] from liability” by a conditional covenant not to
sue. Id. “[B]y the terms of the AOC itself, the resolution of liability would not occur until
performance was complete, which is the first time at which the covenant would have any
effect.” Id. Making explicit which of these two features it regarded as dispositive, the
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court went on to note that, “[o]f course, if the EPA had included an immediately effective
promise not to sue as consideration for entering into the agreement, the situation would
be different.” Id. at 213 (discussing RSR Corp. v. Comm’l Metals Co., 496 F.3d 552 (6th
Cir. 2007)).
In NCR, the question before the court was again “whether [the contribution
seeker] ha[d] resolved its liability to the government through [a] consent order[.]” 768
F.3d at 692. Relying on Bernstein, the court dispatched the question easily: the consent
order included unconditional covenants not to sue from the federal and state
governments, and therefore had “resolved” the contribution seeker’s liability. The court
noted that
the [consent] order also ha[d] language conditioning the
covenants on “satisfactory performance” of [the contribution
seeker’s] obligations. But this mean[t] only that the federal or
state government could sue [it] if it breach[ed] the
agreement—a standard arrangement that [was] consistent
with the fact that neither the EPA nor [the state government]
could sue [the contribution seeker] if it complied with its
obligations. The agreement resolved . . . liability . . . . To hold
otherwise would mean that no consent order could resolve a
party’s liability until the work under it was complete. Such a
rule would be contrary both to the analysis in Bernstein and to
common sense.
Id.
Application of the above principles to this case presents no difficulty. The 1998
Consent Decree resolved Refined’s liability to the United States and a state for some or
all of a response action by including EPA’s and IDEM’s unconditional covenants not to
sue. Dkt. 12 Ex. A, at 36–38. It is true that the decree did not constitute “an admission of

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any fact or legal issue, or of any liability or wrongdoing relating” to the Facility and the
Property, id. at 40, but Bernstein is clearer than a remediated stream that this fact is not
controlling. 733 F.3d at 213. The point is that Refined unconditionally assumed a legal
obligation and unconditionally received a legal benefit in order to resolve a legal
dispute—not that it pronounced a legal mea culpa. In this posture, Refined is like a
defendant in a criminal case who enters an Alford plea, which undoubtedly “resolves”
liability by agreement without admitting it. See, e.g., Hicks v. Hepp, 871 F.3d 513, 520
n.3 (7th Cir. 2017).
Refined offers no contrary argument as to “resolution” under Bernstein and NCR.
Rather, it has chosen to stand on its argument that the 1998 Consent Decree did not
“resolve” liability because it did not resolve CERCLA liability. See Br. Opp. 8–14. But
we do not find that argument persuasive, as explained above.
3. The Action Is Untimely
Because the 1998 Consent Decree resolved Refined’s liability to the United States
and Indiana, at least in part, “entry” of it triggered the three-year limitations period. 42
U.S.C. 9613(g)(3)(B). The contribution claim advanced in this action, filed in 2017, is
therefore time-barred.
Understandably, Refined objects that the limitations period should not begin to run
where remediation work at the Property “required [EPA] approval every step of the
way[,]” Br. Opp. 14, and was only completed within the last three years. Id. But this
argument suffers from several deficiencies. First, NCR rejected as contrary to Bernstein
and common sense the notion that no settlement “resolves” liability until the work under
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it is complete. 768 F.3d at 692. Second and relatedly, the plain language of Section
113(g)(3)(B) provides that the period begins to run from “entry” of a settlement, not from
its performance, discharge, or termination. 42 U.S.C. § 9613(g)(3)(B). Third, we take it
as fundamental that a plaintiff cannot itself choose when a limitations period to which it
is subject begins to run, for the contrary position is at war with every policy underlying
limitations periods. See CTS Corp. v. Waldburger, 134 S. Ct. 2175, 2182–83 (2014)
(discussing such policies). Accepting Refined’s position would permit plaintiffs to
choose for themselves when their rights accrue, and when the applicable limitations
periods begin to run, by yoking those events to conduct at least in part within plaintiffs’
control: to wit, the date of completion of settlement-mandated work.
Prudentially, we note that Section 113(g)(2) appears to provide for Refined’s
concerns. That section supplies the limitations period for Section 107(a) cost recovery
actions, and requires a court to “enter a declaratory judgment on liability for response
costs or damages that will be binding on any subsequent action or actions to recover
further response costs or damages.” 42 U.S.C. § 9613(g)(2). Though that procedure is
mandated for Section 107(a) claims, we perceive no reason why a declaratory judgment
action would not serve equally well in Section 113(f) claims, at the option of a
contribution seeker finding itself in Refined’s position of certainty as to a PRP’s
contribution liability but uncertainty as to its precise extent.
Finally, Refined argues that there were in fact multiple remedies ordered at the
Property, and that it seeks to recover now only for the latest. But “[s]uch slicing and
dicing of costs incurred under the same [settlement] makes little sense . . . .” NCR, 768
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F.3d at 692. It is inconsistent with the posture of this case, which involves only one
settlement, and inconsistent too with the nature of a “remedy” within the meaning of
CERCLA, see Compl. ¶ 29 (“The corrective measures undertaken by Refined under the
Consent Decree are a remedy or remedial actions within the meaning of . . . CERCLA”),
which comprises “those actions consistent with permanent remedy . . . .” 42 U.S.C. §
9601(24) (emphasis added). Refined’s liability was “resolved” only once and only one
judicially approved settlement was “entered.” Accordingly, we conduct only one
timeliness analysis, which Refined’s claim fails to satisfy. Compare Bernstein, 733 F.3d
at 215 (justifying two separate timeliness analyses with reference to two separate consent
orders requiring two “temporally discrete projects”).
4. Conclusion
In sum, the 1998 Consent Decree resolved Refined’s liability to the United States
and Indiana for some or all of the remediation of the Facility and the Property,
notwithstanding that it did not specifically resolve CERCLA liability. Entry of the 1998
Consent Decree caused accrual of a Section 113(f)(3)(B) contribution claim, precluding
resort to a Section 107(a) cost recovery action for the same remediation. But, under the
three-year limitations period established by Section 113(g)(3)(B), Refined’s accrued
contribution action became time-barred long before this action was filed. Accordingly,
Refined’s complaint states no viable federal claims and to that extent must be dismissed
with prejudice.

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II. Jurisdiction is Relinquished Over the State-Law Claims (Counts III, IV)
“When district courts dismiss all claims independently qualifying for the exercise
of federal jurisdiction, they ordinarily dismiss as well all related state claims.” Artis v.
District of Columbia, 138 S. Ct. 594, 597–98 (2018) (citing 28 U.S.C. § 1367(c)(3)). In
other words, under the supplemental jurisdiction statute, 28 U.S.C. § 1367, there is a
“sensible presumption that if the federal claims drop out before trial, the district court
should relinquish jurisdiction over the state-law claims.” Williams Elecs. Games, Inc. v.
Garrity, 479 F.3d 904, 907 (7th Cir. 2007) (citing Groce v. Eli Lilly & Co., 193 F.3d 496,
501 (7th Cir. 1999)). The Seventh Circuit has identified
three situations in which jurisdiction over supplemental
claims should be retained . . . : where the statute of limitations
would bar the refiling of the supplemental claims in state
court . . . ; where substantial federal judicial resources have
already been expended on the resolution of the supplemental
claims; and where it is obvious how the claims should be
decided.
Id. (internal citation omitted) (citing cases).
Here, Refined pleaded in its complaint that “[t]his Court has supplemental
jurisdiction over the state law claims alleged herein pursuant to 28 U.S.C. § 1367.”
Compl. ¶ 3. There is also an allegation that “[t]he amount in controversy in this action
exceeds $75,000.00 and is between citizens of different states[,]” id. ¶ 1, an invocation of
our diversity jurisdiction. See 28 U.S.C. § 1332. However, the invocation is ineffective:
the amount in controversy must exceed $75,000 “exclusive of interest and costs[.]” 28
U.S.C. § 1332(a); see Powers v. Fultz, 404 F.2d 50, 52 (7th Cir. 1968) (affirming
dismissal of complaint failing to plead “exclusive of interest and costs”). In the face of
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this insufficiency, we take Refined at its word that the state-law claims are here under our
supplemental jurisdiction. Therefore, the federal claims having been dismissed, we must
decide whether to relinquish jurisdiction over the balance.
All signs point to relinquishment. Taking the above recited factors in order, after
Artis it is clear that the statute of limitations will not bar refiling. Artis considered the
provision of the supplemental jurisdiction statute that the limitations period on any claim
in federal court under supplemental jurisdiction “shall be tolled while the claim is
pending and for a period of 30 days after it is dismissed unless State law provides for a
longer tolling period.” 28 U.S.C. § 1367(d). Artis held that to “toll” the limitations period
“means to hold it in abeyance, i.e., to stop the clock[,]” 138 S. Ct. at 598, the Seventeenth
Century notwithstanding. See id. at 610 (Gorsuch, J., dissenting). Thus, if Refined’s statelaw claims were timely when filed in this Court, the clock has not run on them since, and
will not begin to run again until thirty days after this action is no longer pending before
us, unless Indiana law provides a longer tolling period.
No substantial federal resources have yet been expended on this case, which is still
in the earliest stage of litigation.
Finally, it is not at all obvious how the state-law claims should be decided. In its
briefing, Refined represents that it has withdrawn its common law indemnity claim, Br.
Opp. 19, so we focus only on the claim under the ELA Statute. The difficulty there is the
operation of recently enacted Ind. Code § 34-11-2-11.5, which provides that “a person
may seek to recover . . . in an [ELA] . . . to recover costs incurred for . . . a remedial
action . . . : [t]he costs incurred not more than ten . . . years before the date the action is
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brought[.]” Id. § 34-11-2-11.5(b). The question is whether this provision sets a ten-year
limit on damages recoverable in an ELA, with the timeliness of the ELA itself governed
by other statutes of limitations as set forth in Pflanz v. Foster, 888 N.E.2d 756 (Ind.
2008), and Peniel Group, Inc. v. Bannon, 973 N.E.2d 575 (Ind. Ct. App. 2012), or,
instead, supplants those other statutes of limitations and establishes as timely any ELA
brought at any time for any portion of response costs incurred within ten years of filing.
Bernstein and Peniel, without addressing the question directly, appear to assume
the latter reading. 733 F.3d at 216 n.16; 973 N.E.2d at 580 n.4. Schuchman/Samberg
Investments, Inc. v. Hoosier Penn Oil Company, addressing the question directly but only
in dicta, favors the former reading. 58 N.E.3d 241, 246 n.5 (Ind. Ct. App. 2016)
(questioning Bernstein). Because the application of Ind. Code § 34-11-2-11.5 would
likely be dispositive of our ruling on NL’s motion to dismiss, with only uncertain statecourt guidance it is not obvious how Refined’s claim under the ELA Statute should be
decided.
Accordingly, we relinquish jurisdiction over the state claims.
Conclusion and Order
For the reasons explained above:
Counts I and II of the complaint are DISMISSED WITH PREJUDICE as
precluded and untimely.
Counts III and IV of the complaint are DISMISSED WITHOUT PREJUDICE for
lack of jurisdiction.

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Final judgment will be entered by separate document. Fed. R. Civ. P. 58(a).
IT IS SO ORDERED.

Date:

9/25/2018

_______________________________
SARAH EVANS BARKER, JUDGE
United States District Court
Southern District of Indiana

Distribution:
Donald C. Biggs
TAFT STETTINIUS & HOLLISTER LLP (Indianapolis)
[e-mail]
Robert L. Collings
SCHNADER HARRISON SEGAL & LEWIS LLP
[e-mail]
Frank J. Deveau
TAFT STETTINIUS & HOLLISTER LLP (Indianapolis)
[e-mail]
Joel L. Herz
LAW OFFICES OF JOEL L. HERZ
[e-mail]
J. Richard Moore
BLEEKE DILLON CRANDALL
[e-mail]

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