EPEC POLYMERS, INC. v. NL INDUSTRIES, INC.
MEMORANDUM OPINION. Signed by Judge Michael A. Shipp on 5/24/2013. (gxh)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
EPEC POLYMERS, INC.,
Civil Action No. 12-3 842 (MAS) (TJB)
NL INDUSTRIES, INC.,
SHIPP, District Judge
This matter comes before the Court on Defendant NL Industries Inc.’s (“Defe
“NL”) Motion to Dismiss pursuant to Federal Rule of Civil Procedure (“Rule
”) 12(b)(6), (Def.’s
Br., ECF No. 10-1.) Plaintiff EPEC Polymers, Inc. (“Plaintiff” or “EPEC
”), filed Opposition.
(PI.’s Opp’n, ECF No. 12.) Defendant filed a Reply. (ECF No. 15.)
The Court has carefully
considered the Parties’ submissions and decided the matter without oral
Rule 78. For the reasons set forth below, and other good cause shown,
Defendants’ Motion to
Dismiss is GRANTED in part and DENIED in part.
The following facts are drawn from the Complaint and are taken as true
for purposes of
this Opinion. EPEC is a Delaware corporation with its principal place
of business located in
1, ECF No. 1.) EPEC owns a parcel of land in an industrial area of Woodb
Township, New Jersey, situated along the northern shore of the Raritan
River (the “EPEC Site”).
5.) The EPEC Site was used for the production of chemical products by EPEC and its
Heyden Chemical Corporation (“Heyden”),
Corporation and Tenneco Chemical Company. The EPEC Site covers a total of approximately
185 acres that are in varied states of use, (Id.
The southern two-thirds of the EPEC Site are
wetlands and are divided by berms created by the United States Army Corps of Engineers
(“Army Corps”) into the Central and Southern Wetlands. (Id.
¶91 8-10.) This
Central Wetlands, which cover approximately 45 acres. (Id.
lawsuit concerns the
NL is a New Jersey corporation with its principal place of business located Dallas, Texas.
¶ 2.) Directly across the Raritan River from the EPEC Site, but
within the Borough of
Sayreville, lies property formerly owned by NL and its predecessors that was also used for
production of chemical products (the “NL Site”). (Id.
were active at the NL Site from 1935 until 1982. (Id.
12-17.) Chemical production operations
13.) Plaintiff alleges that the production of
these chemicals, and their ensuing disposal, render the NL Site a “facility” for purposes of
liability. (Id. 91108.) When referring to the NL Site for purposes of liability, and as explained
more fully below, the Court, as does Plaintiff, will use the term “NL Facility.”
Plaintiff’s Complaint alleges that hazardous waste and by-product materials generated at
the NL Site/Facility in the form of thorium, uranium and radium (the “Radiological Materials”)
were dumped by NL and its predecessors into the Raritan River between the years of 1935 and
14-38.) “As a result of these discharges,” Plaintiff alleges that “the Radiological
Materials came to be located in the Raritan River sediments.” (Id.
Prior to the discharge of the Radiological Materials, the Raritan River underwent a series
of dredging projects to widen and deepen a channel for shipping. (Id.
40-45.) That process
continued when discharge of the Radiological Materials was occurring. In or around 1940, and
pursuant to the 1937 River and Harbor Act and the National Defense River and Harbor Act, Pub.
L. No. 76-868, the Raritan River was targeted by the Army Corps for further dredging. (Id.
53.) The Army Corps contacted landowners and businesses along the banks of the Raritan River
to “secure locations for the deposition of dredge spoils that would be generated” by further
54.) EPEC’s predecessor, Heyden, entered into an agreement with the Army
Corps for the placement of dredge spoils on the Central Wetlands. (Id.
¶91 55-56.) Dredging
commenced in December 1940, but no dredge spoils were deposited on the Central Wetlands
until 1943. (Id.
57-62,) From approximately 1943 to 1947, “dredge spoils removed from the
were placed on the Central Wetlands portion of the EPEC [Site].” (Id.
Skipping forward nearly sixty-five years to “April 2009, EPEC performed a gamma
surface survey at the EPEC [Sitel” that “detected the presence of elevated levels of thorium in the
According to EPEC, “[tjhorium was never produced, generated and/or used
at the EPEC [Sitel.” (Id.
67.) Furthermore, “[sjubsequent investigations at the
Wetlands have revealed elevated levels of thorium and the other Radiological Materials in the
Central Wetlands (the “Radiological Contamination”).” (Id.
70.) Plaintiff contends that the
source of the Radiological Contamination is the Radiological Materials discharged by Defendant
into the Raritan River and removed to the Central Wetlands by the Army Corps’ dredging
process. (Id. ¶9171-77.)
Plaintiff has spent “over $2 million investigating the Radiological Contamination in the
Central Wetlands” and believes it will continue to “incur significant costs related to the
investigation and/or remediation of the” contamination, (Id.
¶91 84-85.) Remediation is anticipated
to include, but not be limited to, “the excavation, transportation, and disposal of soils and other
material containing [the] Radiological Contamination.” (Id.
91 85.) The damages from the
contamination also extend to the natural resources and wetlands located within the Central
Wetlands. (Id. ¶ 86.)
Plaintiff’s Complaint seeks to hold Defendant liable via several theories: 1) common law
trespass; 2) common law private nuisance; 3) several causes of action pursuant to the federal
Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42
§ 9601 et. seq., as amended by the Superfund Amendments and Reauthorization Act of
1986 (“SARA”), Pub. L. 99—499, 100 Stat. 1613 (1986), including a cost recovery action
§ 9607(a), contribution pursuant to § 9613(f), and declaratory judgment pursuant to §
9613(g)(2); 4) declaratory judgments pursuant to 28 U.S.C. § 2201 and N.J. Stat. Ann. § 2A: 1650, et. seq.; 5) the New Jersey Spill Compensation Act pursuant to N.J. Stat. Ann. § 58:10-23,11
et. seq.; 6) negligence; 7) strict liability; and 8) common law indemnification.
Standard for Motion to Dismiss
Rule 8(a)(2) “requires only ‘a short and plain statement of the claim showing that the
pleader is entitled to relief,’ in order to give the defendant fair notice of what the
claim is and
the grounds on which it rests.” Bell All. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting
C’oniev v. Gibson, 355 U.S. 41, 47 (1957)). On a motion to dismiss for failure to state a claim, a
“defendant bears the burden of showing that no claim has been presented.” Hedges v. United
States, 404 F.3d 744, 750 (3d Cir. 2005).
A district court conducts a three-part analysis when considering a Rule 1 2(b)(6) motion.
Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011). “First, the court must ‘take note of the
elements a plaintiff must plead to state a claim.” Id. (quoting Ashcrqft v. Iqbai, 556 U.S. 662,
675 (2009)). Second, the court must accept as true all of a plaintiff’s well-pleaded factual
allegations and construe the complaint in the light most favorable to the plaintiff. Fowler v.
UPMC Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009). The court, however, must disregard any
conclusory allegations proffered in the complaint. Id. For example, the court is free to ignore
legal conclusions or factually unsupported accusations which merely state that “the-defendant
unlawfully-harmed-me.” Iqbai, 556 U.S. at 678 (citing Twombly, 550 U.S. at 555). Finally, once
the well-pleaded facts have been identified and the conclusory allegations ignored, a court must
next determine whether the “facts alleged in the complaint are sufficient to show that plaintiff has
a ‘plausible claim for relief.” Fowler, 578 F.3d at 211 (quoting Iqbai, 556 U.S. at 679).
Determining plausibility is a “context-specific task which requires the reviewing court to
draw on its judicial experience and common sense.” Iqbal, 556 U.S. at 679. Plausibility, however,
“is not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a
defendant has acted unlawfully.” Id. at 678 (quoting Twombly, 550 U.S. at 545). In the end, facts
which only suggest the “mere possibility of misconduct” fail to show that the plaintiff is entitled
to relief. Fowler, 578 F.3d at 211 (quoting Iqbal, 556 U.S. at 679).
Defendant moves pursuant to Rule 12(b)(6) to dismiss all of Plaintiff’s CERCLA claims,
as well as
Plaintiff’s common law trespass claim, common law private nuisance claim and
common law contribution claim.
Plaintiff’s CERCLA Claims
CERCLA and SARA “were enacted to provide for liability and remediation of hazardous
substances in the environment and for cleanup of inactive hazardous waste sites.” New Jersey
Tpk. Auth. v. PPG Indus., Inc., 197 F.3d 96, 103 (3d Cir. 1999) (“PPG”). “CERCLA and SARA
together create two legal actions by which parties that have incurred costs associated with
cleanups can recover some or all of those costs: (1) Section  cost recovery actions; and (2)
Section  contribution actions.” Morton Int’l, Inc. v. A,E. Staley Ivfg. Co., 343 F.3d 669,
675 (3d Cir. 2003). CERCLA is a strict liability statute which imposes liability jointly and
severally upon potentially responsible parties (“PRPs”) “for costs associated with cleanup and
remediation.” PPG, 197 F.3d at 104. Section 9607 only provides three enumerated defenses, none
of which are relevant to this case. See 42 U.S.C.
§ 9607(b). Here, Plaintiff has sought relief under
both Sections 9607 and 9613, each of which will be addressed in turn.
Plaintiff’s Cost Recovery Claim —42 U.S.C.
The Third Count of Plaintiff’s Complaint seeks recovery of “all costs incurred by EPEC
in connection with the investigation and/or remediation of hazardous substances and/or material
discharged and/or released from the NL Facility that came to be located on the EPEC [Site].”
91 117.) This count relies on two distinct theories of CERCLA liability:
1) “owner/operator” liability; and 2) “arranger” liability. (See id.
919[ 108-14.) For the reasons
stated more fully below, both EPEC’s owner/operator and arranger liability claims state a prima
facie cause of action under
§ 9607(a) and survive NL’s Motion to Dismiss,
Plaintiff’s Owner/Operator Theory
CERCLA liability under
§ 9607 requires a plaintiff to prove: “1) that the defendant is a
PRP; 2) that hazardous substances were disposed of at a ‘facility’; 3) that there has been a
‘release’ or ‘threatened’ release of hazardous substances from the facility into the environment;
and 4) that the release or threatened release has required or will require the plaintiff to incur
‘response costs.” PPG, 197 F.3d at 103-04. The PRPs relevant to the current case are “1) the
current owner or operator of a facility; 2) any person who owned or operated the facility at the
time of the disposal of a hazardous substance; and 3) any person who arranged for disposal or
treatment, or arranged for transport for disposal or treatment of hazardous substances at a facility
The Parties’ Positions
The Complaint alleges that the “NL Facility is a ‘facility’ within the meaning of 42 U.S.C.
§ 960 1(9).” (Compl. ¶ 108.) In more detail, Plaintiff’s first theory of liability under Section 9607
(1) EPEC is the owner of the EPEC [Site]
; (2) NL owned and operated the NL
Facility [on the NL Sitej
; (3) NL discharged waste material from the NL
Facility containing Radiological Materials into the Raritan River that became
located in the river sediments
; (4) the dredge spoils that were placed on the
EPEC [Sitel contained Radiological Material from NL’s discharge and/or release
of waste materials from the NL Facility
; (5) Radiological Materials that were
released and/or discharged from the NL Facility into the Raritan River came to be
located and/or placed on the EPEC [Site]
; (6) EPEC has incurred and will
continue to incur response costs as a result of NL’ s Radiological Material that are
present or came to be located on the EPEC [Sitel
; (7) such costs were incurred
consistent with the National Contingency Plan [created as part of CERCLAI.
(Pl.’s Br, 8; see generally Compl. ¶(J[ 107-13.)
Defendant argues that the EPEC Site is the only “facility” relevant to EPEC’s claims
because the NL Facility/Site is “not the facility at which the hazardous waste came to be located
or where EPEC allegedly has incurred ‘response costs’ for which it now seeks recovery under
CERCLA.” (Def.’s Br. 12.) Thus, NL argues, because it never owned or operated the EPEC Site
it cannot be liable as an owner/operator for any hazardous materials located there. (Id.) Plaintiff
disputes NL’s contentions and argues that “[t]here is no authority in CERCLA, or in the case law
interpreting it, that owner/operator liability attaches only if the discharger owned or operated the
location at which the release from its facility came to be located.” (Pl.’s Opp’n 10.)
NL’s argument that the EPEC Site is the only “facility” in question for purposes of this
case, and that its lack of ownership of the EPEC Site bars Plaintiff’s owner/operator claim, does
not persuade the Court. Plaintiff’s third count alleging liability pursuant to § 9607(a) and based
upon owner/operator liability states a prima facie cause of action and will be allowed to proceed.
The Parties primarily discuss four cases regarding Defendant’s argument. Each of those
cases interpret the breadth of the term “facility” as defined by CERCLA. CERCLA defines a
(A) any building, structure, installation, equipment, pipe or pipeline (including any
pipe into a sewer or publicly owned treatment works), well, pit, pond, lagoon,
impoundment, ditch, landfill, storage container, motor vehicle, rolling stock, or
aircraft, or (B) any site or area where a hazardous substance has been deposited,
stored, disposed of, or placed, or otherwise come to be located; but does not
include any consumer product in consumer use or any vessel.
42 U.S.C. § 9601.
Defendant states that the Third circuit in FPG “emphasized the importance of limiting
identification of the ‘facility’ at issue to the specific site giving rise to the cost recovery claim.”
(Def.’s Br. 12 (citing PPG, 197 F.3d at 105).) In PPG, the New Jersey Turnpike Authority sought
to hold producers of chromate ore processing residue (“COPR”) liable under CERCLA for
remediation costs arising from “seven different sites along the New Jersey Turnpike that the
Turnpike alleges have been contaminated with COPR.” PPG, 197 F,3d at 99. The PPG
interpreted the Turnpike Authority’s claims as alleging: “the eastern spur of the New Jersey
Turnpike is the ‘facility’ in question, and that the sites at issue here can be considered the
environmentally impacted portions of the overall ‘facility’ for the purposes of determining
whether the appellees are liable.” Id. at 105.
The Third circuit rejected that concept and held that “allowing the ‘facility’ to be the
entire eastern spur, where the Turnpike’s claim seeks costs relating to seven specific sites, would
result in an unwarranted relaxation of the [causal nexus required [to prove a link between the
COPR producing defendants and the seven sites owned by the Turnpike].” Id. According to
Defendant, the relevant facility was “not the property from which the COPR originated” but was,
rather, “the site where [the] defendants were alleged to have deposited or caused the disposal of
COPR and at which the Authority incurred response costs.” (Def.’s Br. 13.)
Plaintiff responds that Defendant has misread PPG and taken its causation analysis out of
context. According to Plaintiff, in PPG the Turnpike “attempted to circumvent [CERCLA’ s
causation requirements] by arguing that the entire eastern spur of the New Jersey Turnpike should
be considered a single “facility” for CERCLA liability purposes
(Pl.’s Opp’n 11.)
Moreover, Plaintiff contends that PPG “addressed the ‘causation requirements’ for the definition
of [al ‘facility’ under an arranger liability analysis
‘facility’ with respect to owner/operator liability.
and did not address the definition of [a]
(Id. at 11 (emphasis added).)
Regarding PPG, Plaintiff has the stronger argument. First, the Turnpike was alleging a
form of arranger liability, not owner/operator liability. PPG, 197 F.3d at 105 (“The Turnpike
argues that all three appellees are PRPs by virtue of their having arranged for disposal and
transport of the COPR at the seven sites.”) (emphasis added). Second, because the Turnpike had
failed to demonstrate the required “connection between the actions of the [defendants] and the
COPR contamination at the sites in question,” no claim for arranger liability could be supported.
Id. As such, the alternative attempt by the Turnpike to expand the facility to the entire eastern
spur of the Turnpike, rather than focus on the defendant COPR producers’ ties to the seven sites,
was viewed as “an unwarranted relaxation of the [causal] ‘nexus’ required,” even when taking
into account the “remedial purpose of CERCLA and less stringent notions of proof and causation
underlying a CERCLA claim.” Id. Contrary to NL’s assertions, PPG does not bar EPEC’s claim
based upon a theory of owner/operator liability.
In fact, the cases cited by Plaintiff demonstrate that, although the facts in the case at bar
are unique, designation of the NL Facility as the “the facility” for purposes of EPEC’s
claim is legally sound. In Beazer, the Court found that the designation of the source of the
pollution on the defendant’s land as the operative “facility,” although
there were areas of the
plaintiff’s property which could be considered “facilities,” was irrelevant because
“had control of the hazardous substances at the time of release.” Louisiana-Pac. Corp.
Materials & Servs., Inc., 811 F. Supp. 1421, 1431 (E.D. Cal. 1993). Therefore, the
designation of the “facility” as the location of the substances at the time of release
appropriate. The fact that the plaintiff in Beazer might have aggravated the problem by further
spreading the hazardous substances originally released by the defendant would only impact the
“issue of damages [and wasi irrelevant for purposes of liability.” Id.
Another case cited by Plaintiff, NutraSweet, further supports the conclusion that EPEC’s
designation of the NL Site as the NL Facility is appropriate. See NutraSweet Co. v. X-L Eng ‘g
Corp., 933 F. Supp. 1409, 1418 (N.D. Ill. 1996), aff’d, 227 F.3d 776 (7th Cir. 2000). In
Nutrasweet, the Court concluded that both the plaintiff’s and the defendant’s lands, which
adjoined each other, could be considered “facilities” for purposes of owner-operator liability.’ Id.
The Court adopts this reasoning. Although the EPEC Site may arguably be
considered a “facility” as well, that fact does not require dismissal of Plaintiff’s owner/operator
Finally, the fact that the sites at issue in this case are not adjacent in the same sense as
they were in Nutrasweet and Beazer is a distinction without a difference. It can plausibly be
The fact that the Nutrasweet court did not hold the defendant liable as an owner or operator, due
to the fact that the defendant did not own or operate the facility, does not affect this conclusion
because the inquiry at this juncture of this case asks only whether the designation of the NL Site
as a facility is a proper basis for an eventual/possible finding of liability. Nutrasweet clearly
indicates that it is.
Defendant’s citation to United States v. Davis, 31 F. Supp. 2d 45 (D.R.I. 1998) does not change
the Court’s conclusion. The Davis court was correct to conclude therein that arranger liability was
the only appropriate theory to hold the defendants located in New Jersey liable under CERCLA,
The Court, however, does not agree with Defendant that accepting that NL may be liable under
argued that they are functionally adjacent due to the fact that they share a common border on the
Raritan River, Moreover, taking the facts in the Complaint as true, and keeping in mind the strict
liability nature of CERCLA, the fact that a third-party in the form of the Army Corps may have
removed the Radiological Materials from the riverbed and onto the EPEC site is irrelevant. NL is
strictly liable for damages that result from the discharge of the Radiological Materials into the
river. The fact those materials were transported slightly further than NL may have anticipated
when they allegedly discharged them into the Raritan River, due to strict liability, does not effect
that analysis. Just as the flow of water due to gravity or erosion can transfer hazardous material
from a facility onto adjacent land, see Nutrasweet and Beazer, so too can the actions of a thirdparty.
In addition to the alleged infirmities of Plaintiff’s owner/operator claim, Defendant
contends that Plaintiff’s arranger claim pursuant to
§ 9607(a)(3) fails to state a cause of action.
(Def.’s Br, 14.) The Court disagrees.
CERCLA defines an arranger as:
any person who by contract, agreement, or otherwise arranged for disposal
treatment, or arranged with a transporter for transport for disposal or treatment,
hazardous substances owned or possessed by such person, by any other party
entity, at any facility or incineration vessel owned or operated by another party
entity and containing such hazardous substances.
owner/operator liability in this case would “negate the ‘arranger’ section” in CERCLA and that
“any entity that generated waste containing hazardous substances would be liable as an
owner/operator wherever the waste came to be located
in the United States
Reply 5.) The facts in Davis are simply too dissimilar from the present case. Here, the NL Site
and the EPEC site are several orders of magnitude more proximate than the distance between the
hazardous waste producers in Davis and the landfill in Rhode Island to which their waste was
transported. Defendant, according to the Complaint, discharged waste from the NL Facility into
the Raritan River that was then transported to the opposite river bank by the Army Corps. As
noted earlier, this factual scenario is unique, but not similar enough to Davis that the Court finds
that owner/operator liability may not be appropriate.
In addition to properly alleging that NL is a PRP as an arranger, Plaintiff must also allege
9607 elements listed above: that hazardous substances were disposed of at a
‘facility’; that there has been a “release” or “threatened” release of hazardous substances from the
facility into the environment; and that the release or threatened release has required or will
require the plaintiff to incur “response costs.” PPG, 197 F.3d at 103-04. In the instant motion,
Defendant limits its challenge to whether Plaintiff has properly alleged facts which may support
arranger liability and does not address the additional elements. (See Def.’s Br. 14-22.)
The Third Circuit has laid out a comprehensive analytical framework to determine
whether a defendant qualifies as an arranger. See Morton Int’l, Inc. v. A.E. Staley Mft’. Co., 343
F.3d 669, 676-80 (3d Cir. 2003). The Morton court noted that “Congress did not define the term
‘arranged for’ in the statute” and was therefore compelled to begin its analysis with the plain
language of the statute. Id. at 676. After determining that “the dictionary definition of arrange
does not shed much light on the proper scope of liability under this section,” the Morton court
found that Congress’ decision to include the phrase “or otherwise’ after ‘by contract tori
expanded the means by which a party could possibly ‘arrange for’ the treatment
or disposal of hazardous substances in defining this category of PRP.” Id. As such, arranger
liability is to be “broadly construed” in order to be “consistent with Congress’ [1 overall purpose
in enacting CERCLA.” Id. Only through a broadly read scheme of arranger liability could
Congress hold “those actually responsible for any damage, environmental harm, or injury from
chemical poisons LforI the cost of their actions.” Id. (internal quotation marks omitted; citation
The Morton court first noted two main concepts that it felt that the Courts of Appeals
were in agreement with before delving more deeply into the factors. “First, the determination of
‘arranger liability’ is a fact-sensitive inquiry that requires a multi-factor analysis.” Id, at 677.
“Second, courts must look beyond the defendant’s characterization of the transaction at issue in
order to determine whether the transaction, in fact, involves an arrangement for the disposal or
treatment of a hazardous substance.” Id. With those guideposts in mind, the court held that “the
most important factors in determining ‘arranger liability’ are: (1) ownership or possession; and
(2) knowledge; or (3) control.” Id.
Although “[ojwnership or possession of the hazardous substance must be demonstrated,
[thati factor alone will not suffice to establish liability.” Id. Rather, a “plaintiff must also
demonstrate either control over the process that results in a release of hazardous waste or
knowledge that such a release will occur during the process.” Id. (first emphasis added).
Regarding ownership, the court held that “proof of ownership, or at least possession, of
the hazardous substance is required by the plain language of the statute.” Id. at 678. Speaking to
the knowledge requirement, the court held that “proof of a defendant’s knowledge that hazardous
waste can or will be released in the course of the process it has arranged for, provides a good
reason to hold a defendant responsible because such proof demonstrates that the defendant
knowingly (if not personally) contributed to the hazardous-waste contamination.” Id. To that end,
“general knowledge that waste disposal is an inherent or inevitable part of the process arranged
for by the defendant may suffice to establish liability.” Id. (citing United States v. Aceto Agr.
Chems. Corp., 872 F.2d 1373, 1384 (8th Cir. 1989)). This factor can be met, at the motion to
dismiss stage, by alleging facts which would prove “either actual knowledge (e.g., a provision in
an agreement estimating the amount of environmentally harmful spillage inherent in the
processing of the defendant’s materials), or presumed knowledge (e.g., the defendant is familiar
The Morton court was also quick to acknowledge that additional factors may be appropriate in
certain cases and cited various courts for those factors. Id. n.5.
with industry custom, which is that the processing of the particular material normally results in
the release of harmful wastes).” Id. (citing United States v. Cello-Foil Prods., Inc., 100 F.3d
1227, 1231 (6th Cir. 1996); S. Florida Water Mgmt. Dist. v. Montalvo, 84 F.3d 402, 409 (11th
Cir. 1996)). In order to allege proof of control, the plaintiff must plead that the “defendant had
control over the process [sufficient to] establish that the defendant was responsible for the
resulting release of hazardous wastes.” Id. at 679.
In sum, a “plaintiff is required to demonstrate ownership or possession, but liability
cannot be imposed on that basis alone. A plaintiff is also required to demonstrate either
knowledge or control.” Id.
The Parties’ Positions
NL argues that Plaintiff has failed to plead facts that allege a prima facie case of arranger
liability. (Def.’s Br, 14.) First, Defendant argues that Plaintiff has failed to allege that it entered
into any “contract, agreement or arrangement with the Army Corps” regarding the dredge spoils
deposited on the EPEC Site. (Id. at 15.) NL further argues that, even if an agreement existed
between it and the Army Corps, the intent of the agreement was not disposal of waste generated
by NL. Rather, the agreement only intended to deepen and widen the Raritan River to aid in ship
navigation. (Id. at 16-17.)
Second, NL argues that it lacked ownership, knowledge or control over the contaminated
dredge spoils. Regarding ownership, NL argues that “[niothing in the complaint suggests that NL
had an ownership interest in the dredge spoils placed on the EPEC Site by the Army Corps.” (Id.
at 19.) NL further states that EPEC failed to plead any facts that “suggest that NL had any
knowledge that the Raritan River sediments dredged by the Army Corps” contained hazardous
substances derived from NL’s operations and that the dredge spoils would be deposited on the
EPEC Site. (Id. at 20.) NL denies that the Complaint contains facts which sufficiently allege
either actual or presumed knowledge. (Id.) Finally, NL contends the Complaint is devoid of facts
which suggest “that NL had any control over the placement of dredge spoils at the EPEC Site.”
(Id. at 21.)
EPEC, unsurprisingly, disputes NL’s arguments and especially NL’s focus on the dredge
spoils, which it deems a “red herring.” (P1.’ s Opp’n 15.) Rather, EPEC argues that its “claims are
not about the dredge spoils, but rather are about the Radiological Materials, EPEC has alleged
that NL arranged for the disposal of its Radiological Materials by discharging its waste material
directly in the Raritan River.” (Id. at 15.) Because of the strict liability nature of CERCLA, EPEC
maintains that NL “is liable for all response costs incurred in connection with the” Radiological
Materials because NL is responsible for the impact of its discharge of the waste “regardless of
where the hazardous substances ultimately came to be located.” (Id.) Plaintiff also disputes NL’ s
argument that a third party is required in order to find arranger liability. (Id. at 17.) Regarding
intent, Plaintiff alleges that it has properly alleged that Defendant has the requisite intent to
dispose of the Radiological Materials and that Defendant’s focus on the dredge spoils is, as noted
above, irrelevant. (Id. at 21.) Finally, Plaintiff alleges that Defendant had the requisite ownership
interest in the Radiological Materials when it discharged the waste into the river, knowledge that
such discharge was occurring and control over the process by which the discharge was occurring.
(Id. at 22-23.)
Initially, and virtually dispositive of all of the following analysis, the Court notes its
agreement with Plaintiff that the focus of this case is the discharge of the Radiological Materials,
not the eventual placement of the dredge spoils upon the EPEC Site. Due to CERCLA’s strict
liability nature, and the broad interpretation of arranger liability in this Circuit, adoption of
Defendant’s focus on the interactions between NL and its predecessors and the Army Corps is not
appropriate. See PPG, 197 F.3d at 104 (citing United States v. Alcan Aluminum Corp., 964 F.2d
252, 266 (3d Cir. 1992) (“In order to prove a case where a CERCLA plaintiff asserts that a PRP
has ‘arranged’ for the transportation or disposal of hazardous substances,” Third Circuit “case
law is clear that such a plaintiff ‘must simply prove that the defendant’s hazardous substances
were deposited at the site from which there was a release and that the release caused the
incurrence of response costs.”); see also Carson Harbor Viii., Ltd. v. Unocal C’orp., 287 F. Supp.
2d 1118, 1186 (C.D. Cal. 2003) (“In the case of an actual release, the plaintiff need only prove
that the defendant’s hazardous materials were deposited at the site, that there was a release at the
site, and that the release caused it to incur response costs.”), aff’d sub nom., Carson Harbor Viii.,
Ltd. v. Cnty. of Los Angeles, 433 F.3d 1260 (9th Cir. 2006).
Arranger Liability Does Not
Transaction with a Third-Party
NL maintains that it cannot be found liable under arranger liability because it never
entered into a transaction with the Army Corps to have the Radiological Materials removed from
the riverbed onto the EPEC Site. (Def.’s Br. 15-46.) This argument fails in one important respect:
Plaintiff is not required to allege such a transaction, Both the language of § 9607(a)(3) and case
law dictate the conclusion,
Section 9607(a)(3) clearly indicates that “any person who by contract, agreement, or
otherwise arranged for disposal or treatment” of a hazardous substance can be deemed an
arranger. Moreover, and as noted earlier, “by including ‘or otherwise’ after ‘by contract [on
agreement,’ Congress expanded the means by which a party could possibly ‘arrange for’ the
treatment or disposal of hazardous substances in defining this category of PRP.” Morton, 343
F.3d at 676. By doing so, the Morton court concluded that “this expansive list of means indicates
that Congress intended this category of PRP to be broadly construed.” Id.
Speaking directly to the issue at hand, the Ninth Circuit stated that “allowing a generator
of hazardous substances [tol potentially
avoid liability by disposing of wastes without
involving a transporter as an intermediary” would “leave a gaping and illogical hole in
[CERCLA’sJ coverage, permitting argument that generators of hazardous waste might freely
dispose of it themselves and stay outside the statute’s cleanup liability provisions.” Pakootas v.
Teck Cominco Metals, Ltd., 452 F.3d 1066, 1081 (9th Cir. 2006); see also Nail R.R. Passenger
Corp. v. New York City Hous. Auth., 819 F. Supp. 1271, 1276-77 (S.D.N.Y. 1993); State of Cob.
v. Idarado Mm. Co., 707 F. Supp. 1227, 1241 (D. Cob. 1989), amended, 735 F. Supp. 368 (D.
Cob. 1990), rev’d on other grounds, 916 F.2d 1486 (10th Cir. 1990). Defendant contends these
cases are factually distinguishable because of the manner in which the facilities were defined in
those cases. (Def.’s Reply 7.) Simply stated, Defendant has produced no precedent which
supports its contention that arranger “liability does not continue when a third-party subsequently
moves the waste as part of an independent arrangement not involving the alleged arranger.” (Id.)
As such, and considering CERCLA’s broadly remedial nature and strict liability underpinnings,
the Court declines to follow Defendant’s approach and will not distinguish away the above-cited
Plaintiff has Alleged Defendant Acted with the
In addition to its argument regarding the lack of a “transaction” with the Army Corps, NL
alleges that EPEC has failed to plead that NL intended to have the Radiological Materials
disposed of, moved to, or otherwise placed upon the Central Wetlands. (Def.’s Br. 16-17.) EPEC
replies that the only issue to which intent must be proven is “NL’s intentional disposal of the
Radiological Materials directly into the Raritan River, not the placement of the spoils on the
EPEC Property.” (P1.’s Opp’n 21-22.) Both Parties cite to Burlington N. & Santa Fe Ry. Co. v.
United States, 556 U.S. 599 (2009), to support their arguments.
As noted by the Burlington court, “the word ‘arrange’ implies action directed to a specific
purpose.” Id. at 611. “Consequently, under the plain language of the statute, an entity may qualify
as an arranger under
9607(a)(3) when it takes intentional steps to dispose of a hazardous
substance.” Id. As explained earlier, the Court views the relevant action that NL allegedly
undertook with a specific purpose as the discharge of waste into the Raritan River, The fact that
NL may not have intended, or take intentional steps, to have the Army Corps move the
Radiological Waste onto the Central Wetlands is of no moment. Plaintiff has pled the requisite
Plaintiff has Adequately Alleged that Defendant
Owned the Radiological Materials and Acted
with the Required Knowledge and Control
The Parties dispute what “materials” should drive this part of the Court’s analysis.
Defendant contends that the dredge spoils are the relevant subject matter. (Def.’s Br. 18.) Plaintiff
disagrees and argues that the Radiological Materials, and Defendant’s action discharging them
into the Raritan River, should be the nexus of the Court’s analysis. (Pl.’s Opp’n 23.) Again, as
noted earlier, the Court has concluded that Plaintiff has the stronger argument. This distinction
virtually forecloses consideration of Defendant’s arguments and the Court will dispose of them as
succinctly as possible.
Regarding ownership, Plaintiff has clearly alleged that NL both owned and possessed the
Radiological Materials as they were being discharged into the Raritan River between 1935 and
1947. (Compi. ¶9 14-38.) The Complaint also clearly alleges that NL had the requisite
knowledge—actual knowledge that the discharge was occurring and presumed knowledge that its
discharge could result in a release—and control over the discharge process. (Id.
Because the operative event by which NL arranged for the disposal of its waste was the discharge
of the Radiological Materials into the Raritan River, no further analysis is required. Plaintiff’s
9607 claim alleging arranger liability states a prima facie cause of action.
42 U.S.C. 9613(f)
Plaintiff’s Contribution Claim
Count four of Plaintiff’s complaint alleges a cause of action for contribution pursuant to
CERCLA, 42 U.S.C.
9613(f). Defendant argues that this cause of action is improper at this
point in time because Plaintiff has not been “sued under CERCLA or.
otherwise resolved its
liability through an administrative or judicially approved settlement.” (Def.’s Br. 8.) Defendant is
correct. The Supreme Court, in two cases, has made clear that “a private party [can] seek
9613(01 only after being sued under [ 96061 or [ 9607(a)].” United States
v. All. Research Corp., 551 U.S. 128 (2007) (citing Cooper Indus., Inc. v. Aviall Serv., Inc., 543
U.S. 157, 161 (2003). Because Plaintiff has failed to allege that it has been sued pursuant to
9607, or otherwise settled claims brought pursuant thereto, its claim for contribution is therefore
DISMISSED with prejudice. See NL Indus,, Inc. v. Halliburton Co., No. 10-89A, 2010 WL
4340938, at *4 (W,D.N.Y. Nov. 2, 2010) (“[Nb one has sued plaintiff and imposed some sort of
percentage of liability on it that it could try to alter through a contribution claim. As a result,
although plaintiff might have a contribution claim against Halliburton in the future, any attempt
to seek contribution now is premature.”).
42 U.S.C. § 9613(g)(2)
Plaintiff’s Declaratory Judgment Claim
The fifth count of the Complaint seeks a declaratory judgment that Defendant is liable for
all “further response costs or damages” pursuant to § 9607(a) and § 9613(f). Defendant seeks
dismissal of this claim on the assumed basis that both Plaintiff’s § 9607(a) and § 96 13(f) claims
must be dismissed. (Def.’s Br. 23.) Because, as noted above, Plaintiff has stated a viable claim as
9607(a), Plaintiff’s declaratory judgment claim pursuant to
§ 9613(g)(2) survives
Defendant’s Motion to Dismiss.
Plaintiff’s Common Law Trespass Claim
Count one of the Complaint alleges common law trespass. (Compl. ¶91 92-99.) Defendant
contends that the claim is legally barred for two reasons: 1) “New Jersey courts have repeatedly
rejected trespass claims arising from the voluntary acceptance of allegedly contaminated fill
material,” and 2) the fact that Plaintiff may not have known the dredge spoils contained the
Radiological Materials does not support a claim of trespass. (Def.’s Br. 24-25.) Plaintiff contends
that New Jersey case law does not bar trespass claims related to hazardous waste and that EPEC’s
predecessor did not consent to the disposal of the Radiological Materials on the Central Wetlands.
Rather, Plaintiff contends Heyden only consented to the placement of dredge spoils it otherwise
thought were benign. (P1.’s Opp’n 25-27.)
“Trespass constitutes the unauthorized entry (usually of tangible matter) onto the property
of another.” New Jersey Tpk. Auth. v. PPG Indus., Inc., 16 F, Supp. 2d 460, 478 (D,N.J. 1998),
197 F.3d 96 (3d Cir. 1999). The Parties have each cited cases which they believe support
their relative positions that a trespass claim, based upon the facts in the Complaint, is, or is not,
currently permitted under New Jersey law. An extended discussion of those cases is not required
because the Court finds reference to a recent case persuasive and adopts its reasoning in whole.
In Woodcliff, the Hon. Joel A. Pisano, U.S.D.J., held on facts extremely similar to the
ones presented here, that “use of trespass liability” is an “inappropriate theory of liability’ and an
‘endeavor to torture old remedies to fit factual patterns not contemplated when those remedies
were fashioned.” Woodclzff Inc. v. Jersey Const., Inc., 2012 WL 3822139, at *3,
F. Supp. 2d
(D.N.J. 2012) (citing New Jersey Turnpike. Auth., 16 F. Supp. 2d at 478 (D.N.J. 1998);
Preft?rred Real Estate Invs., Inc. v. Edgewood Props., Inc., 2007 WL 81881 (D.N.J. Jan 09,
2007)). Pursuant to the reasoning in Woodcliff the Court DISMISSES Plaintiff’s common law
trespass claim with prejudice.
Plaintiff’s Common Law Private Nuisance Claim
The Second Count of EPEC’s Complaint alleges a common law private nuisance claim.
“Under New Jersey law, ‘the essence of a private nuisance is an unreasonable interference with
the use and enjoyment of land.” Rowe v. E.I. Dupont De Nemours & Co., 262 F.R.D. 451, 459
(D.N.J. 2009) (quoting Sans v. Ramsey Golf and Country Club, Inc., 29 N.J. 438, 448 (1959)). Tn
order to be successful, a Plaintiff “must show that ‘there has been an unreasonable, unwarranted
or unlawful use by a person of his real property which is resulting in a material annoyance,
inconvenience or hurt.” Id. (quoting State, Dept. Of Envtl Prot. v. Exxon Corp., 151 N.J. Super.
464, 482-83 (Ch. Div. 1977)). As the Rowe court noted, “New Jersey courts have moved toward
a strict liability theory with respect to environmental pollution cases and away from such
common law claims as trespass and nuisance.” Id. at 45 8-59 (quoting Borough of Rockaway v.
Kiockner & Kiockner, 811 F. Supp. 1039, 1053 (D.N.J. 1993)). “[Tlhere are two elements to a
private nuisance claim: 1) unreasonable use by the defendant and 2) significant harm to the
plaintiff.” Id. at 459.
Defendant contends and Plaintiff concedes, however, that there can be additional elements
to a private nuisance cause of action, proximity and contemporaneousness. (Def.’s Br. 26; P1,’s
Opp’n 30,) Plaintiff refutes the relevance of these elements to this case. (Pl.’s Opp’n 30.) The
Court agrees with Plaintiff: as stated in Rowe, “the ‘neighboring or adjoining’ requirement
[exists I for a different reason: a nuisance claim requires a contemporaneous relationship between
the plaintiff and defendant. In other words, a successor landowner cannot assert a nuisance claim
against a predecessor landowner because the nuisance property and the affected property are one
and the same.” Rowe, 262 F.R.D. at 459-60 (emphasis added) (citing T & E Indus., Inc. v. Safety
Light Corp., 123 N.J. 371, 385 (1991).
The additional cases cited by Defendant speak to the same predecessor/successor
dynamic. See T & E Indus., 123 N.J. at 385 (“Historically, private-nuisance law resolved disputes
between neighboring property owners over contemporaneous land uses” and therefore “did not
cover conditions existing on the very land transferred” and a “successor in title could not ground
its claim on a private-nuisance theory.”); Philadelphia Elec. Co. v. Hercules, Inc., 762 F.2d 303,
314 (3d Cir. 1985) (“nuisance law can be seen as a complement to zoning regulations.. and not
as an additional type of consumer protection for purchasers of realty”). Although the concept of
private nuisance is becoming disfavored in New Jersey courts for contamination actions, it has
not yet been abandoned and Plaintiff has pled a prima facie claim.
Plaintiff’s Common Law Indemnification Claim
Plaintiff’s common law indemnification claim is dismissed for failure to state a cause of
action. “Common-law indemnity [is] an equitable doctrine that allows a court to shift the cost
from one tortfeaser to another.” Promaulayko v. Johns Manville Sales C’orp., 116 N.J. 505, 511
(1989), “Two different situations can give rise to indemnification: either when a contract
expressly provides for it, or when a special legal relationship creates an implied right of
indemnity.” Ferriola v. Stanley Fastening Sys., L.P., No. 04-4043 (JET), 2007 WL 2261564, at *2
(D.N.J. Aug. 1, 2007). Here, Plaintiff has not alleged the existence of a contract. “As for the
special relationship requirement, while ‘the case law is not exhaustive, examples of special
relationships are: principal-agent, employer-employee, lessor-lessee, and bailor-bailee,” SGS
U.S. Testing Co., Inc. v. Takata Corp., No. 09-6007 (DMC), 2012 WL 3018262, at *4 (D.N.J.
July 24, 2012) (citation omitted).
Plaintiff argues that a “special legal relationship” exists here because courts have found
such a relationships under a “breadth of circumstances.” (P1.’ s
Opp’ n 34.) In fact, Plaintiff alleges
that courts in this district have “consistently recognized that the requisite special relationship can
result from the ‘wrongdoer’s failure to discover or correct a defect or remedy a dangerous
condition.” (Id.) (citing Smith v. Lindemann, No. 10-3319 (FSH), 2011 WL 3235682, at *1 n.4
(D.N.J. July 28, 2011). The expansive reading that Plaintiff advocates has been curtailed by some
courts. See Takata, 2012 WL 3018262, at *5 (“[ljmplied indemnification by way of a special
relationship is a ‘narrow doctrine’ that is not frequently stretched beyond the examples of
principal-agent, employer-employee, lessor-lessee, and bailor-bailee.”).
Here, the Court finds that, based upon the facts alleged by Plaintiff, a special relationship
does not exist, The alleged relationship between Plaintiff and Defendant is not of the type
typically used to support common law indemnification and the Court does not find any reason to
apply Lindemann ‘s categories of special relationships to the facts presented here. The Parties are
simply too tangentially related for the Court to exercise its equitable powers and impose
indemnification constructively. The Court, however, only DISMISSES this claim without
prejudice and grants Plaintiff leave to amend this claim to allege facts which may support the
existence of a special relationship.
For the reasons set forth above, and other good cause shown, it is hereby ordered that
Defendant’s Motion to Dismiss is GRANTED in part and DENIED in part. Count One, common
law trespass, is DISMISSED with prejudice. Count Two, common law private nuisance, states a
facie cause of action. Count Three, CERCLA cost recovery pursuant to 42 U.S.C. §
9607(a) based upon both owner/operator and arranger liability, states a prima facie cause of
action. Count Four, CERCLA contribution pursuant to 42 U.S.C.
9613(f), is DISMISSED with
prejudice, Count Five, CERCLA declaratory judgment pursuant to 42 US.C.
a prima fricie cause of action. Count Ten, Common Law Indemnification is DISMISSED without
prejudice. Plaintiff is instructed to submit an Amended Complaint removing the counts dismissed
with prejudice by June 7, 2013. As indicated above, the Amended Complaint may contain an
amended claim for common law indemnification.
s/ Michael A. Shipp
MIcHAEL A. SHIPP
UNITED STATES DISTRICT JUDGE
Dated: May 24th, 2013
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