Team Enterprises v. Western Investment Real Estate
647 F.3d 901
9th Cir.2011Background
- Team Enterprises, LLC leased a Modesto shopping center from 1980 to 2004 and operated a dry cleaning store using perchloroethylene (PCE), a California hazardous substance.
- Team used Puritan Rescue 800 equipment designed and manufactured by Street to filter and recycle PCE-laden wastewater.
- Wastewater from the Rescue 800 was poured into a bucket and then down the sewer, with some PCE remaining dissolved in water.
- Soil contamination occurred and the California Regional Water Quality Control Board ordered cleanup, which Team conducted at its expense.
- Team sued Street and others in the Eastern District of California for CERCLA contribution and state-law claims; the district court granted Street summary judgment on all claims.
- The central issue is whether Street is a CERCLA arranger liable for cleanup costs or a nuisance/trespass defendant under California law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Street is liable as a CERCLA arranger | Team contends Street arranged disposal of hazardous substances via product design and sale of Rescue 800 | Street argues no arranger liability because it did not intend disposal and did not control Team's disposal | Street not liable as arranger under CERCLA |
| Whether intent to dispose can be inferred from design or warnings | Team argues Rescue 800 design and lack of warnings show intent to dispose | Street contends no evidence of intent to dispose; mere design features or warnings do not prove disposal intent | No arranger liability based on design or warnings without specific disposal intent |
| Whether Street exercised control over disposal to support arranger liability | Street controlled disposal by design or contract | Street had no ownership, possession, or duty to dispose; no actual control over Team’s disposal | No control over disposal; no arranger liability |
| Whether nuisance or trespass claims survive | Contamination and disposal activities create nuisance/trespass | Rescue 800 not a disposal system; contamination resulted from Team’s actions; no actionable entry by Street | Nuisance and trespass claims fail; judgment affirmed |
Key Cases Cited
- Burlington Northern & Santa Fe Ry. Co. v. United States, 129 S. Ct. 1870 (U.S. 2009) (establishes that arranger liability requires intent to dispose)
- Cal. Dept. of Toxic Substances v. Alco Pac., Inc., 508 F.3d 930 (9th Cir. 2007) (useful product doctrine and intent implicit in disposing waste)
- United States v. Shell Oil Co., 294 F.3d 1045 (9th Cir. 2002) (control over disposal is crucial to arranger liability)
- Newhall Land & Farming Co. v. Superior Ct., 23 Cal. Rptr. 2d 377 (Cal. Ct. App. 1993) (continuing trespass theory not applicable here)
- City of Modesto Redev. Agency v. Superior Court, 13 Cal. Rptr. 3d 865 (Cal. Ct. App. 2004) (civil nuisance liability requires creation or assistance in creation of nuisance)
- Selma Pressure Treating Co. v. Osmose Wood Preserving Co. of Am., Inc., 271 Cal. Rptr. 607 (Cal. Ct. App. 1990) (liability for assisting in the creation of a nuisance requires affirmative acts or disposal system)