Gould Electronics Inc. v. Livingston County Road Commission

Filing 121

OPINION & ORDER Denying Plaintiff's Motion for Partial Summary Judgment (Dkt. 90 ) and Denying Defendant's Motion for Summary Judgment (Dkt. 86 ). Signed by District Judge Mark A. Goldsmith. (Sandusky, K)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

GOULD ELECTRONICS INC.,
Plaintiff,

Case No. 17-11130

vs.

HON. MARK A. GOLDSMITH

LIVINGSTON COUNTY ROAD
COMMISSION,
Defendant.
_______________________________/
OPINION & ORDER
DENYING PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT (Dkt. 90)
AND DENYING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT (Dkt. 86)
This matter is before the Court on Plaintiff Gould Electronics Inc.’s (“Gould”) motion for
partial summary judgment (Dkt. 90) and Defendant Livingston County Road Commission’s
(“LCRC”) motion for summary judgment (Dkt. 86). Both motions have been fully briefed.
Because oral argument will not assist in the decisional process, the motions will be decided based
on the parties’ briefing. See E.D. Mich. LR 7.1(f)(2); Fed. R. Civ. P. 78(b). For the reasons
discussed below, the Court denies both motions.
I.

BACKGROUND

Gould initiated this environmental contamination case against LCRC on July 6, 2009.
Gould Electronics, Inc. v. Livingston Cty. Rd. Comm’n, No. 09-cv-12633 (E.D. Mich.) (the “prior
action”). In short, the case concerned the “determination of responsibility for costs associated with
the cleanup and remediation of trichloroethylene (‘TCE’) contamination on two adjacent parcels
of real property and the surrounding area,” located in Howell, Michigan. Gould Electronics, Inc.
v. Livingston Cty. Rd. Comm’n, No. 09-cv-12633, 2012 WL 5817937, at *1 (E.D. Mich. May 25,
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2012). One of the parcels is owned by LCRC (the “LCRC Property”), and Gould is indisputably
responsible for liabilities arising from an adjoining parcel (the “Gould Property”). Id. Gould
admits that it is partially responsible for the contamination of soil and groundwater, but alleges
that LCRC shares responsibility for the contamination. Id. LCRC, however, contends that Gould
is fully responsible. Id.
On May 29, 2012, the parties stipulated to an order of dismissal without prejudice in the
prior action, in accordance with a tolling agreement entered into by the parties on May 21, 2012
(the “Tolling Agreement”). See Stip. Order of Dismissal, Ex. A to Am. Compl. (Dkt. 22-2). The
order of dismissal provided that either party could revive the surviving claims by filing a complaint
initiating a new action. Id. ¶ 2. The order of dismissal also provided that in the event a new action
was initiated “the current record, pleadings, Joint Final Pretrial Order, discovery, expert reports,
legal positions of the parties, etc. in this lawsuit shall be preserved as applicable and binding,”
while discovery would be limited to new data gathered regarding the contamination. Id. ¶ 4.
Gould initiated the present case on April 11, 2017, and filed its most recent amended
complaint on October 8, 2019, in which it asserted claims for (1) cost recovery under the
Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42
U.S.C. § 9607(a), and (2) contribution under Michigan’s Natural Resources and Environmental
Protection Act (“NREPA”), Mich. Comp. Laws § 324.20129. See 3d Am. Compl. (Dkt. 76).
However, Gould has agreed to voluntarily dismiss its NREPA contribution claim. Pl. Resp. at 25
(Dkt. 100).
LCRC filed a counter-complaint on July 15, 2019, in which it brought counterclaims
against Gould for (1) cost recovery under CERCLA, (2) contribution under NREPA, and (3) cost
recovery under NREPA, Mich. Comp. Laws § 324.20126a. Counterclaim (Dkt. 59). However,

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LCRC agreed to voluntarily dismiss its cost recovery claims under both CERCLA and NREPA.
Def. Resp. at 8 (Dkt. 101). With leave of the Court, 1/22/20 Order (Dkt. 117), LCRC filed an
amended counter-complaint asserting counterclaims against Gould for (1) contribution under
CERCLA and (2) contribution under NREPA, Am. Counter-Compl. (Dkt. 118).
Gould has now filed a motion for partial summary judgment with respect to LCRC’s
liability, arguing that the Court previously determined that Gould has established a prima facie
case for cost recovery under CERCLA, a strict liability statute. Meanwhile, LCRC has filed a
motion for summary judgment seeking dismissal of Gould’s CERCLA cost recovery claim,
arguing that it is exempted from liability under two statutory affirmative defenses.1
II.

STANDARD OF REVIEW

A motion for summary judgment under Federal Rule of Civil Procedure 56 shall be granted
“if the movant shows that there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). A genuine dispute of material fact
exists when there are “disputes over facts that might affect the outcome of the suit under the
governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “[F]acts must be
viewed in the light most favorable to the nonmoving party only if there is a ‘genuine’ dispute as
to those facts.” Scott v. Harris, 550 U.S. 372, 380 (2007). “Where the record taken as a whole
could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for
trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).

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Gould also sought summary judgment in its favor with respect to LCRC’s cost recovery
counterclaims under CERCLA and NREPA, while LCRC sought summary judgment in its favor
with respect to Gould’s NREPA contribution claim and its CERCLA cost recovery counterclaim.
As described above, however, each of these claims has been voluntarily dismissed.
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Once the movant satisfies its initial burden of demonstrating the absence of any genuine
issue of material fact, the burden shifts to the nonmoving party to set forth specific facts showing
a triable issue of material fact. Scott, 550 U.S. at 380; Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986). The nonmoving party “must do more than simply show that there is some metaphysical
doubt as to the material facts,” Scott, 550 U.S. at 380 (quoting Matsushita, 475 U.S. at 586), as the
“mere existence of some alleged factual dispute between the parties will not defeat an otherwise
properly supported motion for summary judgment,” id. (quoting Anderson, 477 U.S. at 247-248)
(emphasis in original); see also Babcock & Wilcox Co. v. Cormetech, Inc., 848 F.3d 754, 758 (6th
Cir. 2017) (“A mere scintilla of evidence or some metaphysical doubt as to a material fact is
insufficient to forestall summary judgment.”).
III.

DISCUSSION

A. Gould’s Motion for Partial Summary Judgment
Gould contends that it is entitled to partial summary judgment regarding LCRC’s liability,
as the Court previously held that Gould has established a prima facie case of cost recovery under
CERCLA. Pl. Mot. at 8. Because CERCLA is a strict liability statute that imposes liability
regardless of causation or fault, United States v. Puerto Rico Indus. Rev. Co., 287 F. Supp. 3d 133,
141, 144 (D.P.R. 2017), Gould urges the Court to enter summary judgment with respect to LCRC’s
liability.
Gould is mistaken in its argument, as the Court has not held that Gould established a prima
facie case as a matter of law. Rather, the Court found that Gould had presented sufficient evidence
supporting a prima facie case, such that summary judgment could not be awarded against it. In an
opinion denying LCRC’s motion for summary judgment in the prior action, the Court noted that

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to establish a prima facie case for cost recovery under CERCLA, a plaintiff must demonstrate the
following elements:
(1) a polluting site is a ‘facility’ within the statute’s definition; (2) the facility
released or threatened to release a hazardous substance; (3) the release caused the
plaintiff to incur necessary costs of response; and (4) the defendant falls within one
of four categories of potentially responsible parties.
Gould, 2012 WL 5817937, at *7 (quoting Village of Milford v. K–H Holding Corp., 390 F.3d 926,
933 (6th Cir. 2004)). When the Court rendered its decision, there was no dispute regarding the
first or fourth elements.2 Id. Rather, LCRC disputed the second and third elements, arguing that
Gould could not demonstrate that a “release” occurred on the LCRC Property. Specifically, LCRC
argued that the evidence did not support a finding that any of the TCE contamination originated
from the LCRC Property or that LCRC was at fault for a release. Id.
With respect to the second element, the Court agreed with Gould that “it has met its prima
facie burden of establishing that a release has occurred on LCRC’s property.” Id. at *8. The Court
reasoned that “the very presence of TCE on LCRC’s property, which is undisputed, illustrates that
a release of that substance has occurred because the presence of TCE in the soils and/or
groundwater under LCRC’s property indicates a ‘leaching’ of that substance.” Id. The Court
further rejected LCRC’s position that Gould was required to demonstrate fault or that the release
originated from the LCRC Property in order to establish a prima facie case. Id.
With respect to the third element, the Court distinguished the present case from Kalamazoo
River Study Group v. Rockwell Int’l Corp., 171 F.3d 1065, 1069-1070 (6th Cir. 1999), in which
the plaintiffs failed to proffer reliable scientific evidence establishing that a release on the

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LCRC continues to admit both that the LCRC Property has been designated a “facility” and that
LCRC is a “covered person” within the meaning of 42 U.S.C. § 9607(a). Def. Mot. at 9-10 (Dkt.
86-1).
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defendant’s property contributed to contamination at the location where the plaintiffs had incurred
response costs. In the present case, by contrast, the Court held that “it is undisputed that Gould
has incurred, and will continue to incur, costs arguably responsive to the presence of TCE on
LCRC’s property, given that it is undisputed that there is a co-mingled plume of contamination
migrating northeast of the properties . . . .” Gould, 2012 WL 5817937, at *8 (emphasis added).
Although the Court acknowledged that the evidence was consistent with the possibility that Gould
incurred response costs attributable to a release on the LCRC Property, it did not hold that this
element was established as a matter of law. Gould, therefore, has not established a prima facie
case as a matter of law, as there remains a question of fact with respect to whether the release on
the LCRC Property caused Gould to incur response costs.
Accordingly, Gould is not entitled to summary judgment on its CERCLA cost recovery
claim.
B. LCRC’s Motion for Summary Judgment
LCRC asserts that it is entitled to summary judgment with respect to Gould’s CERCLA
cost recovery claim because it is shielded from liability under two statutory affirmative defenses:
(1) the “innocent landowner” defense under 42 U.S.C. § 9607(b), and (2) the “contiguous
landowner” defense under 42 U.S.C. § 9607(q). Def. Mot. at 10, 19.
1. Innocent Landowner Defense
As a preliminary matter, Gould contends that LCRC is barred from asserting the innocent
landowner defense because it was not raised in the joint final pretrial order (“JFPO”) in the prior
action and because the Court has previously precluded LCRC from raising it. Pl. Resp. at 14-17
(Dkt. 100).

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Gould is correct that LCRC failed to assert the innocent landowner defense in the JFPO in
the prior action. See generally JFPO at 14-24, Gould Electronics, Inc. v. Livingston Cty. Rd.
Comm’n (2012) (No. 09-cv-12633), ECF No. 147. Permitting LCRC to advance the defense
would require the Court to evaluate whether the TCE contamination was caused by one or both of
the parties and whether LCRC exercised due care with respect to the contamination—factors that
are part of the equitable “Gore factors” relevant to LCRC’s contribution counterclaim under
CERCLA. See Kerr-McGee Chem. Corp. v. Lefton Iron & Metal Co., 14 F.3d 321, 326 (7th Cir.
1994).3 Inclusion of the defense in the present litigation, therefore, would not prejudice Gould
because it would not introduce new issues or involve new evidence.
Further, the Court stated in a previous opinion that “the applicability of the innocent
landowner defense is not currently at issue, as LCRC has not invoked the defense or discussed its
applicability.” Gould, 2012 WL 5817937, at *7. In so stating, the Court did not foreclose LCRC
from raising the innocent landowner defense. Rather, the Court held that the defense was simply
not at issue because LCRC had not raised it in its motion for summary judgment. Accordingly,
the Court will consider the merits of the innocent landowner defense.

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The “Gore factors” were originally part of an amendment to the 1980 House Superfund Bill.
Then “Congressman Albert Gore proposed the criteria as a moderate approach to joint and several
liability, and the six criteria are often referred to as the ‘Gore Factors.’” Envtl. Transp. Sys., Inc.
v. ENSCO, Inc., 969 F.2d 503, 508 (7th Cir. 1992). The six factors are: “(1) the ability of the
parties to demonstrate that their contribution to a discharge, release or disposal of a hazardous
waste can be distinguished; (2) the amount of the hazardous waste involved; (3) the degree of
toxicity of the hazardous waste involved; (4) the degree of involvement by the parties in the
generation, transportation, treatment, storage, or disposal of the hazardous waste; (5) the degree of
care exercised by the parties with respect to the hazardous waste concerned, taking into account
the characteristics of such hazardous waste; and (6) the degree of cooperation by the parties with
Federal, State, or local officials to prevent any harm to the public health or the environment.”
Kerr-McGee, 14 F.3d at 326 n.4.
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Under the innocent landowner defense, 42 U.S.C. § 9607(b)(3), an otherwise liable
defendant is exempt from CERCLA liability if it can establish by a preponderance of the evidence
“(1) that another party was the ‘sole cause’ of the release of hazardous substances and the damages
caused thereby; (2) that the other, responsible party did not cause the release in connection with a
contractual, employment, or agency relationship with the defendant; and (3) that the defendant
exercised due care [with respect to the hazardous substance concerned] and guarded against the
foreseeable acts or omissions of the responsible party.” PCS Nitrogen Inc. v. Ashley II of
Charleston LLC, 714 F.3d 161, 179 (4th Cir. 2013). Gould contests LCRC’s ability to demonstrate
both that Gould was solely responsible for the release of TCE and that LCRC exercised due care
in preventing further contamination. Pl. Resp. at 18.
a. Sole Cause
With respect to the causation element of the innocent landowner defense, LCRC contends
that Gould is solely responsible for the release of TCE discovered on the Gould and LCRC
Properties. Def. Mot. at 10. However, the evidence presented by both parties reveals there are
questions of fact regarding whether LCRC contributed to the contamination.
In support of its position that Gould is solely responsible for the contamination, LCRC first
relies upon letters issued by the Michigan Department of Environmental Quality (“MDEQ”)
terminating its investigation of the LCRC Property.4 Id. at 11. On June 14, 2019, the MDEQ sent
LCRC a letter stating that it “agrees with the LCRC that there is no indication that a release of
chlorinated solvents . . . occurred, and no releases of chlorinated solvents into LCRC property site
soils are demonstrated to be directly attributable to LCRC’s historic operations.” 6/14/17 Letter,

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The MDEQ is now known as the Michigan Department of Environment, Great Lakes & Energy
(“EGLE”).
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Ex. T to Def. Mot. (Dkt. 96). The MDEQ then sent a follow-up letter clarifying that it was not
requesting the performance of additional sampling or report submittals and that it had “no further
regulatory interest in the origin of the TCE contamination on that property.” 6/23/17 Letter, Ex.
U to Def. Mot. (Dkt. 96-1).
LCRC contends that the Court should accord considerable deference to the MDEQ’s
decision regarding LCRC’s CERCLA obligations, in accordance with Chevron U.S.A., Inc. v.
Natural Res. Def. Council, Inc., 467 U.S. 837 (1984). Def. Mot. at 11. However, the letter dated
June 14, 2019, states expressly that the decision reached by the MDEQ is not to be “construed as
a liability determination for the chlorinated solvent contamination on the subject property.”
6/14/17 Letter. And according to Susan Leeming, the former chief of MDEQ’s Division of
Remediation and Redevelopment, the MDEQ’s decision was motivated by its prioritization of
more pressing issues, and did not constitute a determination that LCRC was “off the hook.”
Leeming Dep. at 21-22, Ex. B to Def. Reply (Dkt. 105). Thus, the MDEQ’s decision does not
purport to find that LCRC has no environmental liability, and in any event is not binding on this
Court.
LCRC also relies on the conclusions drawn by its expert, Constance Travers, in arguing
that Gould is solely responsible for the TCE contamination. Def. Mot. at 12-15. According to
Travers, who reviewed LCRC Property site records, employee depositions, and soil and
groundwater testing data, Gould’s waste dumping practices were the only source of TCE
contamination in soils and groundwater. Travers Report at 5, Ex. J to Def. Mot. (Dkt. 89-3).
According to the depositions of two former Gould employees, Ron Galarneau and Keith
Richardson, it was common practice for Gould employees to dispose of waste fluids on the ground
at the Gould Property. See Galarneau Dep. at 34, 38-44, Ex. C to Def. Mot. (Dkt. 88-2);

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Richardson Dep. at 29-32, 37, 45-46, Ex. E to Def. Mot. (Dkt. 88-4). Galarneau and Richardson
testified that these fluids were regularly disposed of on the portions of the Gould Property
immediately adjacent to the LCRC Property and near the railroad tracks in the northeast corner of
the Gould Property. Galarneau Dep. at 34, 41-43; Richardson Dep. at 29.
By contrast, based on her review of LCRC’s site records describing product purchases,
Travers opined that LCRC did not use or purchase TCE prior to 1985. Travers Report at 13.
Between 1985 and 1986, LCRC’s use of TCE on the LCRC Property was limited to a maximum
of seventeen asphalt tests. Id. at 13-14. Based on the testimony of Frederick Marr, an LCRC
engineering aide responsible for handling TCE during the asphalt testing, Travers determined that
these seventeen tests combined would have required a total of eight to thirteen gallons of TCE. Id.
at 14 (citing Marr Dep. at 13, Ex. 8 to Pl. Resp. (Dkt. 100-9)). In 1987, LCRC replaced TCE used
in asphalt testing with BioAct, an alternative cleaning agent. Id.
Travers also stated that the testimony of LCRC employees who handled TCE during the
asphalt testing “demonstrates that they were aware of the need to containerize and properly dispose
of the TCE used in these tests.” Id. at 19. Indeed, Marr testified that he would collect used TCE
in a five-gallon bucket, which he then transferred to a 55-gallon drum. Marr Dep. at 12-13. He
expressly denied ever disposing of TCE on the ground, or ever witnessing anyone else do so. Id.
at 15-16.
Eric Little, an LCRC technical services supervisor, testified similarly regarding LCRC’s
TCE disposal practices, stating that he had no knowledge of anyone disposing of chemicals onsite. Little Dep. at 14, 19, Ex. 9 to Pl. Resp. (Dkt. 100-10). Little further confirmed that TCE was
used for approximately two years until the Michigan Department of Transportation required that
BioAct replace TCE. Id. at 11-12. Little testified that the 55-gallon drum in which LCRC

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employees collected TCE was picked up by Safety-Kleen Systems, Inc.—LCRC’s solvent
provider—but that he did not know what happened to the contents of the drum afterwards. Id. at
14. As noted by Gould, however, Safety-Kleen’s vice president of environmental health and safety
testified that the company had no record of picking up TCE waste from LCRC. Ross Dep. at 7,
51-54, Ex. 10 to Pl. Resp. (Dkt. 100-11).
According to Travers, results of the subsurface investigations of the Gould and LCRC
Properties demonstrate that the soil and groundwater contamination was caused solely by Gould’s
disposal of TCE. Travers Report at 5. Based on the soil testing performed on the Gould and LCRC
Properties, Travers noted that “[t]he only portion of the LCRC property where TCE has been
observed in soils is the northwestern corner of the LCRC property . . . adjacent to the Gould
disposal area.” Id. at 26. Likewise, the highest concentrations of TCE in groundwater have been
located in the disposal area in the northeastern corner of the Gould Property. Id. at 52. Travers
also opined that the concentrations of TCE in soil and groundwater are consistent with the flow of
groundwater in both a northeastern direction toward Thompson Lake and in a southeastern
direction toward the LCRC Property. Id. at 5.
In stark contrast to Travers’s expert opinion, Gould’s expert, Stanley Feenstra, opined that
“it is probable that most of the TCE contamination found on the LCRC site originated from releases
on the LCRC Site itself.” Feenstra Report at 6, Ex. A to Def. Mot. (Dkt. 88). Based on Feenstra’s
review of LCRC expense records, he believes LCRC purchased large quantities of a chlorinated
solvent during the 1950s and 1960s. Id. at 21. Because “TCE was supplanting carbon tetrachloride
for degreasing applications during this era,” Feenstra opined that it was probable that the carbon
tetrachloride used at the LCRC Property would have been replaced by TCE. Id. at 22. Feenstra

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also stated that it was probable that TCE was used for asphalt testing at the LCRC Property from
approximately 1971 through the late 1980s. Id. at 23.
Feenstra stated that until approximately 1980, disposal of waste TCE on the ground was
common practice. Id. at 25. He further noted that none of the deposition testimony by former
LCRC employees contradicted the possibility that TCE was disposed of in this manner before the
1980s—and further, there were no records documenting off-site disposal. Id. Given the likelihood
that TCE was used at LCRC from the 1950s through the 1980s and that no employee had definitive
knowledge regarding TCE disposal practices during that time, Feenstra opined that it was
“probable” that LCRC employees disposed of TCE by pouring it on the ground. Id. at 7.
Based on his analysis of the topography of the contaminated areas, the pattern of
groundwater flow, and locations of high levels of TCE contamination of the LCRC Property,
Feenstra opined that it was highly improbable that the TCE contamination discovered on the LCRC
Property could have migrated from the Gould Property. Id. at 6. Instead, Feenstra identified an
area of the LCRC Property he believes is “the most probable area of entry of DNAPL [dense
nonaqueous phase liquid] TCE into the subsurface to account for the TCE contamination on the
LCRC Site . . . .” Id. at 37. During his deposition, Feenstra admitted that the manner in which the
TCE would have come to be located there would be a matter of speculation. Feenstra Dep. at 125,
Ex. G to Def. Mot. (Dkt. 89). Although twenty-three soil borings were later performed in this area
between 2012 and 2016, no TCE was discovered. Travers Report at 23-26. Feenstra admits this
fact in his report but states that the testing was defective because samples were not collected from
the appropriate depth, and because groundwater samples were not collected. Feenstra Report at
38. Accordingly, Feenstra maintains that the TCE contamination discovered on the LCRC
Property originated from releases on the LCRC Property itself. Id. at 6.

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LCRC contends that Feenstra’s opinions cannot raise a material issue of fact, as they are
premised on mere speculation. Def. Mot. at 18 (citing Kalamazoo River, 171 F.3d at 1072-1073
(affirming district court’s holding that an expert opinion “based solely on speculation and
possibility . . . . does not create a material issue of fact for trial . . . .”)). But here, Feenstra
opined—based on his analysis of the topography and groundwater elevation on the LCRC
Property—that the groundwater in the areas where TCE concentrations are highest does not flow
from the Gould Property onto the LCRC Property. Feenstra Report at 34. Thus, much of the
contamination present on the LCRC Property cannot be attributed to migration from the Gould
Property. Id. at 39.5 Feenstra’s conclusion that a release of TCE must have taken place on the
LCRC Property is, therefore, supported by his analysis of objective data indicating a low likelihood
that TCE migrated from the Gould Property onto the LCRC Property. Unlike Kalamazoo River,
“‘[t]he analytical gap between the evidence presented and the inferences to be drawn’” is not too
wide. See 171 F.3d at 1073 (quoting Turpin v. Merrell Dow Pharms., Inc., 959 F.2d 1349, 1350
(6th Cir. 1992)).
Gould alternatively contends that the innocent landowner defense is unavailable to LCRC
because it was responsible for releasing TCE on the LCRC Property when it performed a grading
and construction project. Pl. Resp at 20-22. According to Travers, LCRC redistributed TCEcontaminated soils across a broader area of the northwestern portion of its property during the
construction of a salt storage building in 1979. See Travers Report at 9-10. Caselaw has held that

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This opinion is consistent with that of MDEQ’s geologist Dwight Cummings, who wrote in a
2012 request for geological review that there were three areas of TCE contamination on the LCRC
Property that could not be accounted for by migration. Cummings Dep. at 7-10, Ex. 15 to Pl. Resp.
(Dkt. 100-16); see also 11/26/12 Request for Geological Review at 7, Ex. 13 to Pl. Resp. (Dkt.
100-14). Cummings was deposed more recently, in October 2019, and he stated he had no
knowledge if these statements remained accurate. Cummings Dep. at 10. However, he stated that
LCRC had not completed its investigation of TCE. Id. at 21.
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excavation activities can result in a “new release” of contaminants contained in soil. In Ashley II
of Charleston, LLC v. PCS Nitrogen, Inc., 791 F. Supp. 2d 431, 494 (D.S.C. 2011), the court held
that the innocent landowner defense did not apply because the defendants caused new releases of
hazardous substances when they extended water and sewer lines through contaminated soil.
Similarly, in United States v. Honeywell Int’l, Inc., 542 F. Supp. 2d 1188, 1200 (E.D. Cal. 2008),
the court held that the innocent landowner defense was inapplicable because the defendant’s
excavation of its property agitated the soil, thereby releasing contaminants.
The term “release” is defined to mean: “any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment.”
42 U.S.C. § 9601(22). Courts uniformly interpret the word “release” broadly to avoid frustrating
CERCLA’s legislative purpose of protecting and preserving public health and the environment.
See In re Joshua Hill, Inc., 294 F.3d 482, 489 (3d Cir. 2002) (collecting cases interpreting “release”
broadly). While the redistribution of contaminants across a previously uncontaminated area would
fit within the broad definition of a “release,” the evidence before the Court does not clearly
demonstrate the physical scope of LCRC’s grading activities or whether the area surrounding the
salt storage building was uncontaminated before LCRC began its grading. Thus, a question of fact
remains regarding the effects of LCRC’s excavation in that area.
Given the substantial conflicts in the evidence discussed above—including the expert
reports and testimony from the parties’ employees—there are questions of fact regarding LCRC’s
historical use and disposal of TCE, the sources of the TCE contamination in light of the soil and
groundwater analyses, and whether LCRC caused a release of TCE. Accordingly, the Court cannot
determine as a matter of law that Gould is solely responsible for the release of TCE.

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b. Due Care
With respect to the requirement that an innocent landowner exercise “due case with respect
to the hazardous substance concerned,” 42 U.S.C. § 9607(b)(3), LCRC maintains that it has
conducted extensive investigation of the TCE contamination over the course of many years. Def.
Mot. at 5-6. According to Travers, LCRC’s consultant began conducting subsurface investigations
of soils and groundwater on the LCRC Property in the 1990s. Travers Report at 49. Although the
work was primarily associated with removal of underground storage tanks that did not contain
TCE, monitoring wells were installed throughout the LCRC Property, and soil and groundwater
were tested for TCE. Id. Although TCE was not detected in any of the soil samples, it was detected
in one groundwater sample from the northwest corner of the LCRC Property, near the plume of
contamination emanating from the Gould Property. Id.
LCRC continued its collection and analysis of soil and groundwater samples between 2003
and 2015. Id. at 52-54. In 2012, LCRC’s consultant advanced eight boreholes in the possible area
of entry on the LCRC Property identified by Feenstra. Id. at 23. Between 2012 and 2016, LCRC
worked closely with the MDEQ to advance twenty-three additional boreholes in the purported
source location. Id. at 26. A letter from the MDEQ dated January 8, 2015, confirms that LCRC
completed soil borings, soil sampling, and vertical aquifer sampling in 2012 and 2013, and
examined existing monitoring wells and installed a temporary well on the LCRC Property in 2014.
1/8/15 Letter at 1-2, Ex. 21 to Pl. Resp. (Dkt. 100-22).
Gould, however, contends that LCRC cannot demonstrate that it exercised due care
because it failed to take reasonable steps to prevent the continued release of TCE. Pl. Resp. at 2223. In support of its position, Gould submits various letters from the MDEQ noting the inadequacy
of LCRC’s investigation and remediation efforts. Id. In a letter dated February 8, 2012, the MDEQ

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noted that since the MDEQ issued a formal notice in 2007 stating that the LCRC Property was
contaminated, “[t]he LCRC has not conducted sufficient site investigation with regard to
evaluating its known and suspected releases of chlorinated solvents from its historic work
practices.” 2/8/12 Letter at 2, 5, Ex. 20 to Pl. Resp. at 2, 5 (Dkt. 100-21).
In a letter dated January 8, 2015, the MDEQ noted that while LCRC completed a portion
of the response activities requested by the MDEQ, it had not performed all activities necessary to
discharge its obligations under NREPA. 1/8/15 Letter at 1, 3. A September 29, 2015, activity
report documents LCRC’s reluctance to comply with the MDEQ’s request to install a monitoring
well, although LCRC had not installed a single monitoring well on the LCRC Property since the
1980s. Activity Report at 1-2, Ex. 22 to Pl. Resp. (Dkt. 100-23). And on September 7, 2016, the
MDEQ denied LCRC’s proposed response activity plan because “[t]hey do not propose to
complete meaningful response activities to address releases of hazardous substances the LCRC are
and may be responsible for and do not provide schedules for site investigation work.” 9/7/16
Letter, Ex. 23 to Pl. Resp. (Dkt. 100-24).
Moreover, Gould contends that LCRC refused to provide Gould with access to the LCRC
Property to conduct remediation. Pl. Resp. at 23. Consequently, Gould was required to defer
response activities for months while it filed a motion to compel with the Court. See generally Pl.
Mot. to Compel (Dkt. 75). In response to the motion to compel, however, LCRC clearly stated
that it did not oppose the proposed testing for the purpose of developing and executing a remedial
action plan, but rather that it objected to the use of belated testing for purposes of the litigation.
Def. Resp. to Mot. to Compel at 3, 6 (Dkt. 78). There is no other indication in the record that
LCRC refused to provide access to the LCRC Property for remediation.

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Taken as a whole, while some of the evidence suggests that LCRC has made reasonably
diligent efforts since the 1990s to investigate the TCE contamination, other evidence demonstrates
that LCRC did not fulfill certain obligations as promptly or as thoroughly as the MDEQ requested.
In light of this conflicting evidence, whether LCRC exercised due care with respect to the TCE
contamination will require resolution of several questions of fact.
Given the factual questions presented regarding whether Gould was the sole cause of the
contamination and whether LCRC exercised due care with respect to the contamination, this Court
cannot determine as a matter of law that LCRC is exempted from liability for CERCLA cost
recovery under the innocent landowner defense.
2. Contiguous Landowner Defense
LCRC alternatively contends that it is entitled to summary judgment with respect to
Gould’s CERCLA cost recovery claim because it is shielded from liability under the contiguous
landowner defense. Def. Mot. at 19-22. Under 42 U.S.C. § 9607(q), a property owner is not liable
under § 9607(a) if he “owns real property that is contiguous to . . . and that is or may be
contaminated by a release or threatened release of a hazardous substance from, real property that
is not owned by that person,” if certain rigorous qualifications are met.
One of the qualifications a defendant must establish to successfully invoke the contiguous
landowner defense is that, at the time at which the defendant acquired the contaminated property,
it (1) “conducted all appropriate inquiry . . . with respect to the property,” and (2) “did not know
or have reason to know that the property was or could be contaminated by a release or threatened
release of one or more hazardous substances from other real property not owned or operated by
the person.” 42 U.S.C. § 9607(q)(1)(A)(viii).

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According to Gould, LCRC cannot establish this qualification because it was aware of the
TCE contamination when it purchased the LCRC Property. Pl. Resp. at 24. Although LCRC
owned and operated from the LCRC Property since the 1930s, it sold the property to Livingston
County in 2002. Property Purchase Agreement, Ex. 28 to Pl. Resp. (Dkt. 100-29). In 2007, LCRC
received formal notice from the MDEQ that the LCRC Property was contaminated with TCE.
Facility Notification Letter, Ex. 29 to Pl. Resp. (Dkt. 100-30). LCRC later purchased the LCRC
Property back from Livingston County in 2011. Agreement to Purchase Real Estate, Ex. 30 to Pl.
Resp. (Dkt. 100-31). According to the purchase agreement, the purchase price was “equal to the
sums expended in attorney’s fees and costs” by Livingston County in litigating the prior action.
Id. Thus, it is undisputed that LCRC knew at the time it reacquired the LCRC Property from
Livingston County that the property was contaminated with TCE.
LCRC contends that this element of the contiguous landowner defense is inapplicable
because LCRC owned the LCRC Property before the TCE contamination occurred. Def. Mot. at
21-22. However, LCRC does not explain the legal significance of this fact, let alone provide any
authority in support of its argument. Because the evidence clearly establishes that LCRC had
actual knowledge of the TCE contamination at the time it repurchased the LCRC Property from
Livingston County, it cannot establish this necessary element of the contiguous landowner defense.
Because there are questions of fact regarding the application of the innocent landowner
defense and because LCRC cannot establish a necessary element of the contiguous landowner
defense, LCRC is not entitled to summary judgment with respect to Gould’s CERCLA cost
recovery claim.

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IV.

CONCLUSION

For the reasons stated above, Gould’s motion for partial summary judgment (Dkt. 90) and
LCRC’s motion for summary judgment (Dkt. 90) are both denied.
SO ORDERED.
Dated: February 18, 2020
Detroit, Michigan

s/Mark A. Goldsmith
MARK A. GOLDSMITH
United States District Judge

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