69 Bloomingdale, LLC v. Coral Graphics, Inc.
2:20-cv-02613
E.D.N.YJul 14, 2021Background
- Plaintiff 69 Bloomingdale, LLC owns property at 69–83 Bloomingdale Rd., Hicksville, NY (Bloomingdale Site); Coral Graphics operated on adjacent upgradient property owned by F.C. Properties (Coral Graphics Site).
- NYSDEC classified Coral Graphics Site a Class C hazardous waste site; an SVE/air‑sparging system installed in 2005 was shut down by Defendants in 2013, after which contaminated groundwater migrated onto the Bloomingdale Site.
- NYSDEC later listed Bloomingdale as a Potential Hazardous Waste Disposal Site; Plaintiff voluntarily participated in the investigation and incurred environmental and legal costs totaling $156,583.45 (as of Dec. 16, 2020).
- Appraisals before and after listing show market value decline from $6,200,000 to $2,350,000, a loss of $3,850,000.
- Defendants failed to appear; the Clerk entered default. Plaintiff moved for default judgment seeking $3,906,583.45 (costs + lost value); the Magistrate Judge recommended granting default judgment and awarding $4,006,876.88 (costs plus prejudgment interest and lost value).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Defendants are liable under CERCLA §9607 for response costs | Defendants are owners/operators of the Coral Graphics facility, released hazardous substances that migrated offsite, and Plaintiff incurred NCP‑consistent response costs | No timely response; defaulted | Default established liability under CERCLA; default judgment recommended on CERCLA claims |
| Whether state‑law tort claims (nuisance, trespass, negligence) are established | Defendants' shutdown of SVE/AS negligently/knowingly caused contamination migration, interfering with use, constituting trespass and negligence, causing property devaluation | No response; defaulted | Default established liability on nuisance, trespass, and negligence claims; judgment recommended |
| Whether claimed response costs are proven with reasonable certainty | Submitted detailed invoices and affidavits documenting $156,583.45 in environmental and legal costs | No challenge (default) | Costs proven; award of $156,583.45 recommended plus prejudgment interest of $293.43 (total $156,876.88) |
| Whether diminution‑in‑value damages are recoverable and proven | Appraisals show market value decline of $3,850,000 after listing as hazardous site; diminution is proper measure of permanent property injury | No response; defaulted | Loss‑in‑value proven; award of $3,850,000 recommended |
Key Cases Cited
- Vermont Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241 (2d Cir.) (defaulted allegations are taken as true)
- Priestley v. Headminder, Inc., 647 F.3d 497 (2d Cir.) (Rule 55 default judgment framework)
- Burlington N. & Santa Fe Ry. Co. v. United States, 556 U.S. 599 (U.S.) (CERCLA's purposes: timely cleanup and allocating costs to responsible parties)
- United States v. Bestfoods, 524 U.S. 51 (U.S.) (operator liability under CERCLA requires control over pollution‑related operations)
- Niagara Mohawk Power Corp. v. Chevron U.S.A., Inc., 596 F.3d 112 (2d Cir.) (CERCLA recovery and liable parties)
- MPM Silicones, LLC v. Union Carbide Corp., 966 F.3d 200 (2d Cir.) (CERCLA private party contribution and remedial cost allocation)
- Asarco LLC v. Goodwin, 756 F.3d 191 (2d Cir.) (strict liability scope under CERCLA)
- Goodrich Corp. v. Town of Middlebury, 311 F.3d 154 (2d Cir.) (prejudgment interest under CERCLA must be compounded at Treasury/Superfund rates)
- Jenkins v. Etlinger, 55 N.Y.2d 35 (N.Y.) (measure of damages for permanent injury to real property)
- Copart Indus. v. Consolidated Edison Co., 41 N.Y.2d 564 (N.Y.) (elements of private nuisance)