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