U. S. Technology Corporation v. Ramsay et al
Filing
78
ORDER granting in part and denying in part 57 Motion for Partial Summary Judgment. Signed by Honorable David C. Bramlette, III on 5/10/2011 (ECW)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
WESTERN DIVISION
U.S. TECHNOLOGY CORPORATION
VS.
PLAINTIFF/
COUNTER-DEFENDANT
CIVIL ACTION NO. 5:08-cv-218(DCB)(JMR)
PAT RAMSAY
and
DELTA LOGGING & COMPANY, INC.
DEFENDANT
DEFENDANT/
COUNTER-CLAIMANT
MEMORANDUM OPINION AND ORDER
This
Technology
cause
is
before
Corporation
the
Court
(“USTC”)’s
on
motion
the
for
plaintiff
partial
U.S.
summary
judgment (docket entry 57). Having carefully considered the motion
and the plaintiff’s response, as well as the memoranda of the
parties and the applicable law, and being fully advised in the
premises, the Court finds as follows:
USTC moves for summary judgment on Counts I and II of its
Complaint, asserting that the defendants are liable as a matter of
law under the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, 42 U.S.C. § 9601, et seq. (“CERCLA”).
Specifically, the plaintiff asserts that the defendants’ Hydromex
Site is a “facility” within the meaning of CERCLA; a “release” or
“threatened release” of “hazardous substances” occurred at the
Hydromex Site within the meaning of CERCLA; and the defendants are
“covered persons” under CERCLA.
Rule 56(c) of the Federal Rules of Civil Procedure authorizes
summary judgment where “the pleadings, depositions, answers to
interrogatories and admissions on file, together with affidavits,
if any, show that there is no genuine dispute as to any material
fact and that the moving party is entitled to judgment as a matter
of law.”
Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
There is no issue for trial unless there is sufficient evidence
favoring the non-moving party for a jury to return a verdict for
that party.
If the evidence is merely colorable, or is not
significantly probative, summary judgment may be granted. Anderson
v. Liberty Lobby, Inc., 477 U.S. 244 (1986).
On August 11, 2000, USTC entered into a Supply and Recycle
Agreement with Hydromex, Inc. (“Hydromex”).
Pursuant to the
Agreement, USTC shipped spent abrasive blast material (a hazardous
material) to a site in Yazoo City, Mississippi (“the Hydromex
Site”), which Hydromex leased from defendant Delta Logging &
Company, Inc. (“Delta Logging”).
Hydromex agreed to recycle the
hazardous material into a commercial product (concrete blocks and
pads), in conformance with a contract between USTC and the United
States Government.
On June 25, 2002, the Environmental Protection Agency (“EPA”)
conducted a compliance Evaluation Inspection of the Hydromex Site.
It was discovered that most of the spent abrasive blast had not
found its way into the concrete blocks and pads made by Hydromex,
but instead had been buried underground at the Hydromex Site.
On
November 14, 2002, the Mississippi Department of Environmental
2
Quality (“MDEQ”) issued an administrative order accusing Hydromex
of creating an “unauthorized dump,” and ordering Hydromex to cease
“all
acceptance,
material.”
treatment
and
disposal
of
spent
abrasive
On January 23, 2003, after an evidentiary hearing, the
MDEQ issued a cease and desist order.
On July 15, 2003, the plaintiff entered into an Agreed Order
with the MDEQ’s Commission on Environmental Quality.
Pursuant to
the Agreed Order, USTC sought permission to conduct operations at
the Hydromex facility “to recycle and remove the containerized
material and the inadequately or improperly recycled material
located
at
the
Hydromex
facility”
and
to
remove
“both
the
containerized material and the inadequately or improperly recycled
material from the Hydromex facility” (the “Work Plan”).
In order to obtain legal access to the Hydromex site and
permission to conduct these operations, USTC executed a Site Access
Agreement with the site owner, Delta Logging.
The Site Access
Agreement contained an agreement by USTC to “indemnify, defend, and
hold harmless Owner and his employees and agents from and against
all losses, damages, costs, or claims suffered or incurred by Owner
that arise from the entry onto the Property by USTC and its
contractors, consultants, and agents or by the performance of the
Work Plan.”
Site Access Agreement, ¶ 5.
USTC filed its Complaint in this action seeking, inter alia,
cost recovery and contribution under Sections 107(a) and 113(f) of
3
the
Comprehensive
Environmental
Response,
Compensation
and
Liability Act (“CERCLA”), 42 U.S.C. §§ 9607(a) and 9613(f), and for
declaratory judgment under 28 U.S.C. § 2201 and 42 U.S.C. §
9613(g)(2).
Under CERCLA, “facility” includes “any site or area where a
hazardous substance has been deposited, stored, disposed of, or
placed, or otherwise come to be located.”
42 U.S.C. § 9601(9)(B).
The defendants do not dispute that the Hydromex Site is a facility
under CERCLA.
CERCLA defines “release” as “any spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping, or disposing into the environment (including the
abandonment or discharging of barrels, containers, and other closed
receptacles containing any hazardous substance or pollutant or
contaminant) ... .”
substance”
is
42 U.S.C. § 9601(22).
defined
under
CERCLA
by
The term “hazardous
reference
to
other
environmental statutes and includes any characteristic or listed
hazardous waste under the Resource Conservation and Recovery Act,
42 U.S.C. § 6901, et seq. (“RCRA”).
See 42 U.S.C. § 9601(14).
The
defendants do not dispute that a “release” or “threatened release”
of “hazardous substances” occurred at the Hydromex Site.
CERCLA designates four categories of “covered persons” who are
strictly liable for “response costs”:
(1) the owner or operator of a vessel or a facility,
4
(2) any person who at the time of disposal of any
hazardous substance owned or operated any facility at
which such hazardous substances were disposed of,
(3) any person who by contract, agreement, or
otherwise arranged for disposal or treatment, or arranged
with a transporter for transport for disposal or
treatment, of hazardous substances owned or possessed by
such person, by any other party or entity, at any
facility or incineration vessel owned or operated by
another party or entity and containing such hazardous
substances, and
(4) any person who accepts or accepted any hazardous
substances for transport to disposal or treatment
facilities or sites selected by such person.
42 U.S.C. § 9607.
In addition, CERCLA provides covered persons
with a defense from strict liability if they:
can establish by a preponderance of the evidence that the
release or threat of release of a hazardous substance and
the damages resulting therefrom were caused solely by (1) an act of God;
(2) an act of war;
(3) an act or omission of a third party other than
an employee or agent of defendant, or than one whose act
or omission occurs in connection with a contractual
relationship
(except
where
the
sole
contractual
arrangement arises from a published tariff and acceptance
for carriage by a common carrier by rail), if the
defendant establishes by a preponderance of the evidence
that (a) he exercised due care with respect to the
hazardous substance concerned, taking into consideration
the characteristics of such hazardous substance, in light
of all relevant facts and circumstances, and (b) he took
precautions against foreseeable acts or omissions of any
such third party and the consequences that could
foreseeably result from such acts or omissions.
42 U.S.C. § 9607(b).
One
covered
person,
regardless
5
of
its
degree
of
responsibility, is entitled to bring a CERCLA action against other
covered persons to seek contribution for its response costs.
See
Smith Land & Improvement Corp. v. Celotex Corp., 851 F.2d 86, 90
(3rd Cir. 1988)(there is no place in CERCLA for a doctrine which
prevents a covered person, who is culpable for a portion of the
damages, from recovering contribution from another covered person,
who is also culpable for a portion of the damages).
The defendants do not dispute that Delta Logging is a “covered
person” under CERCLA. They do, however, deny that Delta Logging is
liable as a covered person to USTC under CERCLA.
The Court does
not read the plaintiff’s motion as seeking summary judgment on the
issue of liability, but only on the issue of Delta Logging’s status
as a “covered person.”
The plaintiff also seeks summary judgment that Pat Ramsay, as
president/owner of Delta Logging, is a “covered person” under
CERCLA.
An individual corporate officer can be personally liable
under CERCLA “under certain circumstances.”
Kelley v. Thomas
Solvent Co., 727 F.Supp. 1532, 1542 (W.D. Mich. 1989).
The Fifth
Circuit has held that “CERCLA prevents individuals from hiding
behind the corporate shield when ... they themselves actually
participate
in
the
wrongful
conduct
prohibited
by
the
Act.”
Riverside Market Dev. Corp. v. International Building Products,
Inc., 931 F.2d 327, 330 (5th Cir. 1991).
In support of its motion,
the
Ramsay
plaintiff
submits
evidence
6
that
was
also
a
vice
president of Hydromex, and contributed land and buildings to
Hydromex in exchange for 20% ownership in Hydromex.
USTC also
alleges that Ramsay actively participated in the operation and
management of the Hydromex Site and Hydromex facility.
In response, the defendants deny that Ramsay was ever an owner
or officer of Hydromex.
The defendants further deny that a
proposed stock distribution agreement ever came into effect, and
deny that Ramsay ever undertook any actions as a vice president of
Hydromex.
They also deny that Ramsay was directly involved in or
actively participated in the disposal of any spent blast media or
other hazardous material on the Hydromex Site.
The affidavit and
depositions submitted by the defendants demonstrate the existence
of genuine issues of material fact on this issue.
The Court therefore finds that the plaintiff’s motion for
partial summary judgment should be granted in part and denied in
part.
Accordingly,
IT IS HEREBY ORDERED that the plaintiff U.S. Technology
Corporation’s motion for partial summary judgment (docket entry 57)
is GRANTED IN PART AND DENIED IN PART as follows:
GRANTED as to the plaintiff’s claims that the Hydromex Site is
a “facility” within the meaning of CERCLA; that a “release” or
“threatened release” of “hazardous substances” occurred at the
Hydromex Site within the meaning of CERCLA; and that defendant
Delta Logging & Company is a “covered person” under CERCLA;
7
DENIED as to the plaintiff’s claim that defendant Pat Ramsay
is a “covered person” under CERCLA.
SO ORDERED, this the 10th day of May, 2011.
/s/ David Bramlette
UNITED STATES DISTRICT JUDGE
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