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108 F. Supp. 3d 486
S.D. Tex.
2015
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Background

  • Wartime production to support WWII and Korean War led to hazardous waste at Baytown, TX and Baton Rouge, LA sites owned/operated by Exxon’s predecessors.
  • The government contracted with Humble (Baytown) and Standard LA (Baton Rouge) to increase avgas and synthetic rubber production under PAW/WPB-PAW/DSC regimes; government involvement included planning, pricing, and resource allocation but not day-to-day refinery operations.
  • Plancors (synthetic-rubber and avgas-component plants) were built on/near refinery sites; many were government-owned or leased, integrated into the war production complex.
  • Byproducts and wastes from these plants were disposed of in nearby waters (Houston Ship Channel, Mississippi River), with substantial government influence over material allocations and some waste-disposal decisions.
  • Exxon incurred roughly $41 million (Baytown) and $30 million (Baton Rouge) in cleanup costs, contested as to who bears these costs under CERCLA; the case involves Phase I liability/phase II allocation and potential declaratory relief for future costs.
  • CERCLA provisions at issue include §107(a) cost recovery and §113(f) contribution, with debates over exclusive remedies, timing, and allocation methodology.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Is §113(f)(3)(B) the exclusive remedy for costs incurred under administrative settlements with the State? Exxon argues §107(a) may recover costs pre/post-settlement. U.S. contends §113(f)(3)(B) exclusivity governs settlement responses. §113(f)(3)(B) is exclusive for costs incurred under administrative settlements; §107 cannot recover those costs.
Was the United States an operator of the Baytown and Baton Rouge refineries during WWII/Korea? Exxon asserts government’s pervasive wartime control/coordination equates to operator status. US contends it did not manage day-to-day pollution-related operations. United States was not the operator of the refineries; operator status found for plancors and Ordnance Works instead.
Should Exxon’s future costs be declaratorily allocated now or deferred to Phase II? Exxon seeks declaratory judgment on future costs and shares. Allocation premature; defer until Phase II when more facts available. Declaratory judgment awarded for past costs; future-cost allocation deferred to Phase II.

Key Cases Cited

  • Atlantic Richfield Co. v. United States, 551 U.S. 128 (U.S. 2007) (complementary yet distinct rights under §§ 107(a) and 113(f))
  • Burlington Northern & Santa Fe Ry. Co. v. United States, 556 U.S. 599 (U.S. 2009) (sovereign immunity limits; CERCLA allocation aims at responsible parties)
  • United States v. Bestfoods, 524 U.S. 51 (U.S. 1998) (operator liability requires management of pollution-related operations)
  • Trinity Indus., Inc. v. Chicago Bridge & Iron Co., 735 F.3d 131 (3d Cir. 2013) (§113(f)(3)(B) does not require CERCLA liability resolution in particular)
  • Niagara Mohawk Power Corp. v. Chevron U.S.A., Inc., 596 F.3d 112 (2d Cir. 2010) (considers administrative settlements and §113(f) constraints)
  • Niagara Mohawk Power Corp. v. Chevron U.S.A., Inc., 596 F.3d 112 (2d Cir. 2010) (describes contributions under §113(f) vs. §107 remedies)
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Case Details

Case Name: Exxon Mobil Corp. v. United States
Court Name: District Court, S.D. Texas
Date Published: Jun 4, 2015
Citations: 108 F. Supp. 3d 486; 2015 WL 3513949; 2015 U.S. Dist. LEXIS 72593; 81 ERC (BNA) 1346; Civil Action Nos. H-10-2386, H-11-1814
Docket Number: Civil Action Nos. H-10-2386, H-11-1814
Court Abbreviation: S.D. Tex.
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    Exxon Mobil Corp. v. United States, 108 F. Supp. 3d 486