ASARCO, LLC, Plaintiff-Appellant, v. CELANESE CHEMICAL COMPANY, Defendant-Appellee.
No. 12-16832
United States Court of Appeals for the Ninth Circuit
July 10, 2015
Before: William A. Fletcher and Paul J. Watford, Circuit Judges, and Kevin Thomas Duffy, District Judge.
D.C. No. 3:11-cv-01384-WHA. Opinion by Judge Duffy. Argued and Submitted October 8, 2014—San Francisco, California. Filed July 10, 2015.
FOR PUBLICATION
OPINION
Appeal from the United States District Court for the Northern District of California William Alsup, District Judge, Presiding
Argued and Submitted October 8, 2014—San Francisco, California
Filed July 10, 2015
Before: William A. Fletcher and Paul J. Watford, Circuit Judges, and Kevin Thomas Duffy, District Judge.*
Opinion by Judge Duffy
SUMMARY**
Environmental Law
Affirming the district court‘s summary judgment, the panel held that a claim for contribution under
In 1989 plaintiff ASARCO, LLC, entered into a settlement agreement arising frоm a cost-recovery lawsuit under
The panel held that the judicially approved settlement agreement between private parties to the cost-recovery suit started the clock on the three-year statute of limitations in
COUNSEL
OPINION
DUFFY, District Judge:
Plaintiff-Appellant ASARCO, LLC (“ASARCO“) appeals the district court‘s grant of summary judgment in favor of Defendant-Appellee CNA Holdings, LLC1 (“CNA“) in ASARCO‘s suit for contribution under
FACTS AND PROCEDURAL HISTORY
ASARCO is the corporate successor to a company that owned and operated a silver and lead smelter on a 66-acre industrial site (the “Selby Site“) on San Pablo Bay in Contra Costa, California. The smelter operated until 1970, depositing smelting byproducts on its property and the tideland ASARCO leased from the California State Lands Commission (“State Lands“) abutting the property. The smelter was closed after it was named as the likely source of lead pollution that caused livestock deaths nearby. After the smelter closed, ASARCO leased a 1.33 acre parcel of the Selby Site containing а sulfur dioxide plant (“Plant“) that ASARCO had previously operated to Virginia Chemicals, a corporate predecessor to CNA. CNA leased and operated the Plant from 1972 until September 1977. As a result of the Plant operations that occurred before and during CNA‘s leasehold, the soil in the Selby Site area was contaminated with sulfuric acid, as discovered by the San Francisco Bay Regional Water Quality Control Board (the “RWQCB“) in April 1976. RWQCB issued a cleanup and abatement order in August 1976, amended the order in November 1976, and conditionally rescinded the order in April 1977.
After the Plant shut down, and long after smelting had ceased, Wickland Oil Company (“Wickland“) purсhased ASARCO‘s Selby Site property in October 1977, and leased the tidelands from State Lands in July 1981 to build and operate a marine fuel terminal. Wickland learned from the California State Department of Health Services (“California DHS“) that the Selby Site contained hazardous substances, and that further investigation and remediation efforts were required across much of the site. California DHS had identified the presence of toxic metals in the slag pile, with high concentrations of lead, zinc, arsenic, and cadmium. The Selby Site was placed on the California State Superfund list. Wickland incurred environmental response costs and looked for other responsible parties to share those costs.
In February 1989, Wickland, ASARCO, and State Lands (collectively, the “Settling Parties“) entered into the Wickland Agreement, an “Agreement for Entry of Consent Judgment” to “settle and compromise the [district court lawsuit], and to establish a procedure for allocating past and future costs attributable to the evеnts and conditions underlying the [district court lawsuit].” State Lands entered into the agreement as the former owner of part of the Selby Site, not as a “Government Agency.” Although the Settling Parties knew that Virginia Chemicals had been named in the 1976 RWQCB Order and repeatedly referred to in the Wickland lawsuit, Virginia Chemicals had never been brought into the lawsuit as a party, and was not a party to the Wickland Agreement. The district court entered a consent judgment based on the Wickland Agreement on March 13, 1989, and retained jurisdiction over the parties in order to enforce or amend the terms of the Agreement.
In August 2005, sixteen years after the Wickland Agreement settled the Selby Site litigation, ASARCO filed a Chapter 11 voluntary petition in the United States Bankruptcy Court for the Southern District of Texas. State Lands, C.S. Land, Inc. (“CSLI,” Wickland‘s successor in interest), and California Department of Toxic Substances Control (“DTSC,” California DHS‘s successor as the administrating regulatory agency) asserted claims for ASARCO‘s share of past and future Selby Site environmental costs in July 2006 (and amended the claims in 2007). DTSC‘s proof of claim indicated that remediation of the conditions addressed by ASARCO‘s interim remedial measures was not complete and sought to recover costs to implement a final remedy at the Selby Site.
In January 2008, ASARCO moved in the bankruptcy court for approval of a settlement (“2008 Bankruptcy Settlement“) of the response cost claims asserted by State Lands, CSLI and DTSC. Notably, ASARCO‘s parent company filed an objection to the settlement, contending that the settlement included costs to remediate contaminated groundwater that ASARCO had nothing to do with. ASARCO‘s parent withdrew the objection after negotiating a stipulation and clarification with the parties regarding $33 million ASARCO was to pay DTSC under the 2008 Bankruptcy Settlement. The bankruptcy court approved the 2008 Bankruptcy Settlement on March 31, 2008.
On March 23, 2011, ASARCO filed a new lawsuit against CNA to seek contribution under
STANDARD OF REVIEW
Summary judgment in CERCLA cases is reviewed de novo. Carson Harbor Vill., Ltd. v. Unocal Corp., 270 F.3d 863, 870 (9th Cir. 2001) (en banc). The district court‘s interpretation of CERCLA is reviewed de novo. City of Emeryville v. Robinson, 621 F.3d 1251, 1261 (9th Cir. 2010). “Interpretation of a settlement agreement is a question of law subject to de novo review, but we defer to any factual findings made by the district court in interpreting the settlement agreement unless they are clearly erroneous.” Id. (internal citation omitted).
DISCUSSION
I. Introduction
The issues before us hinge on a question of statutory interpretation: Under CERCLA, may a settlement agreement between private parties to a
At oral argument in this case, ASARCO admitted that it could have filed a contribution claim against CNA following the entry of the Wickland Agreement. At issue in this appeal is (1) whether or not a CERCLA contribution claim, once it has accrued, may be excepted from the statute of limitations based on the type of settlement that underlies the claim, and (2) if the claim is subject to the statute of limitations and the time to file has expired, whether the claim may be revived by a subsequent event. We hold that a judicially approved settlement agreement between private parties to a CERCLA cost-recovery suit starts the clock on the three-year statute of limitations in
A. Contribution Claims Are Subject to a Three Year Statute of Limitations.
provides two express avenues for contribution:
§ 113(f)(1) (“during or following” specified civil actions) and§ 113(f)(3)(B) (after an administrative or judicially approved settlement that resolves liability to the United States or a State).Section 113(g)(3) then provides two corresponding 3-year limitations periods for contribution actions, one beginning at the date of judgment,§ 113(g)(3)(A) , and one beginning at the date of settlement,§ 113(g)(3)(B) . . . . [T]o assert a contribution claim under§ 113(f) , a party must satisfy the conditions of either§ 113(f)(1) or§ 113(f)(3)(B) .
Cooper Indus., 543 U.S. at 167. Thus, one “avenue” to a contribution claim accrues once a polluter sues or is sued under
ASARCO contends that the special rights conferred by
B. The Wickland Agreement Triggered the Statute of Limitations of § 9613(g)(3)(B) .
The statute of limitations for a contribution claim is triggered by the date upon which the judgment or settlement that underlies the claim is entered. See id. When the
“Statutes of limitations are intended to provide notice to defendants of a claim before the underlying evidence becomes stale.” In re Hanford Nuclear Reservation Litig., 534 F.3d 986, 1009 (9th Cir. 2008). A primary canon of statutory interpretation is that the plain language of a statute should be enforced according to its terms, in light of its context. Robinson v. Shell Oil Co., 519 U.S. 337, 340 (1997); Wilshire Westwood Assocs. v. Atl. Richfield Corp., 881 F.2d 801, 803 (9th Cir. 1989).
When interpreting a statute, our task is to construe what Congress has enacted. We look first to the plain language of the statute, construing the provisions of the entire law, including its object and policy, to ascertain the intent of Congress. We will resort to legislative history, even where the plain language is unambiguous, where the legislative history clearly indicates that Congress meant something other than what it said.
Carson Harbor Vill., 270 F.3d at 877 (internal quotation marks and citations omitted). “Thus, we examine the statute as a whоle, including its purpose and various provisions.” Id. at 880. We construe the statute in context to avoid superfluities. Cooper Indus., 543 U.S. at 166 (citing Hibbs v. Winn, 542 U.S. 88, 101 (2004)). If possible, we “construe a statute to give every word some operative effect.” Id. at 167 (citing United States v. Nordic Vill., Inc., 503 U.S. 30, 35–36 (1992)). “Clearly, neither a logician nor a
Here, ASARCO suggests that we read into the statutory language a requirement that a judicially approved settlement include the United States or a State in order to trigger the statute of limitations at
Second, our reading does not result in superfluity. The provisions cited by ASARCO in support of its position are distinct in that they confer certain rights upon parties that settle their liability with the government. These rights may encourage parties to settle with the government at an early stage, thus facilitating the cleanup efforts that CERCLA was designed to promote. See Carson Harbor Vill., 270 F.3d at 884. Judicially approved settlements that do not include the United States or a State do not confer such settlement protection. Whether or not a private party “judicially approved settlement” is also a “judgment” that would trigger the statute of limitations at
Third, interpreting the statute of limitations at
III. The Wickland Agreement Covered All Response Costs at the Selby Site and the 2008 Bankruptcy Settlement Merely Fixed Costs.
A. The Scope of the Wickland Agreement
The 1989 Consent Judgment and Wickland Agreement ended the litigation related to the Selby Site, after the appeal in Wickland Oil Terminals v. Asarco, Inc., 792 F.2d 887 (9th Cir. 1986). As discussed earlier, Wickland was permitted to pursue its CERCLA cost recovery claims against ASARCO after we reversed the district court‘s dismissal. In order to determine what the Wickland Agreement covered, we interpret de novo the settlement agreement. City of Emeryville, 621 F.3d at 1261.
Under California law, “the mutual intention of the parties at the time the contract is formed governs interpretation.” AIU Ins. Co. v. Super. Ct., 799 P.2d 1253, 1264 (Cal. 1990) (citing
determined “solely from the written provisions of the contract.” Id. (citing
In this case, the provisions of the contract are clear.4 The Wickland Agreement settled the dispute between ASARCO and Wickland over the Selby Site. In the Wickland Agreement, the parties undertook to “establish a procedure for allocating past and future costs attributable to the events and conditions underlying the [district court case].” The events and conditions underlying the district court case were the industrial operations and resulting pollution that had occurred at the Selby Site prior to Wickland‘s ownership. See Wickland Oil Terminals, 792 F.2d at 889. The parties to the Wickland Agreement, Wickland, ASARCO, and State Lands, agreed to undertake site remediation to investigate, monitor, and abate actuаl or threatened contamination at the Selby Site, caused by or related to the conditions at the site addressed by the Remedial Action Plan.
The Remedial Action Plan was based on a report prepared by an environmental consultant and incorporated into the Wickland Agreement. The goals of the Remedial Action Plan were to dredge contaminated sediments in the tidelands to dispose of them, to remediate acid-affected soils in the Virginia Chemicals area, to cap the site to prevent runoff contamination, and to relocate a sewage oxidation pond. ASARCO, Wickland, and State Lands agreed to share the costs of implementing the initial part of this plan equally. To the extent that a government agency responsible for oversight of the cleanup effort ordered additional work, or the parties mutually agreed that additional work was required to accomplish the Remedial Action Plan, those costs would also be shared equally as a “Subsequent Modification.” The parties decided that if a future cost was an “Other Remediation Cost” and not a “Subsequent Modification,” that ASARCO would bear 42%, State Lands 38%, and Wickland 20% of the future cost. Costs envisioned were necessary and proper if the parties agrеed to them, an arbitrator imposed them, or the government required them as part of a compliance order. The Wickland
The Remedial Action Plan inсluded work in the Virginia Chemicals-leased area. Therefore, the clean-up work that underlies ASARCO‘s contribution claim against CNA was included in the Wickland Agreement. The Remedial Action Plan does not distinguish between site conditions caused by Virginia Chemicals and those caused by ASARCO as a result of sulfur dioxide operations at the Plant. When read in total, it is evident from the terms of the Wickland Agreement that the agreement was meant to be a final determination of each agreeing party‘s liability for costs associated with cleaning up the Selby Site, in accordance with the oversight and requirements of California DHS.
ASARCO argues that the future work to be performed and associated costs were too uncertain under California law to be enforceable by contract. ASARCO cites Robinson & Wilson, Inc. v. Stone, 110 Cal. Rptr. 675, 682-84 (Cal. Ct. App. 1973), in support of that proposition, though that case is factually distinguishable. In Robinson, the contract calling for future work failed to provide sufficient clarity regarding the nature of the work or who would pay for it. See id. at 683. The terms of the Wickland Agreement clearly define who will pay for the work and the nature of the work to remediate the Selby Site, while contemplating that additional tasks may be added to accomplish the remediation‘s goals. Though the complete costs were unknown at the time that the Wickland Agreement was entered, ASARCO‘s contention that the uncertainty of costs then means that the Wickland Agreement could not have covered costs now mirrors ASARCO‘s contention against Wickland in the 1980s litigation.
We previously decided that “[t]he essential fact establishing Wickland‘s right to declaratory relief—the alleged disposal of hazardous substances at the Selby [Site] at the time [ASARCO] owned and operated the smelting facility—has already occurred.” Wickland Oil Terminals, 792 F.2d at 893. The Wickland Agreement functions much like a proportionate liability declaratory judgment would.5 The fact that the full costs were unknown at the time does not mean that the Wickland Agreement was less than comprehensive.
B. The 2008 Bankruptcy Settlement Fixed ASARCO‘s Costs Associated with the Wickland Agreement.
The 2008 Bankruptcy Settlement settled any claims that State Lands and CSLI had against ASARCO as a result of the Wickland Agreement. It also settled ASARCO‘s responsibility vis-a-vis DTSC (California DHS‘s successor) to clean up the Selby Site. The 2008 Bankruptcy Settlement refers to the Wickland Agreement, and states that DTSC required ASARCO, CSLI, and State Lands to conduct additional remediation at the site in order to achieve a “final remedy.” CSLI‘s and State Lands’ proofs of claim in the 2008
of the 2008 Bankruptcy Settlement, ASARCO contended that its fair share of any future work at the Selby Site would be 33%, in accordance with the terms of the Wickland Agreement (although the other Wickland Agreement parties maintained that ASARCO would be liable for 42%, citing a different provision of the Wickland Agreement), and the amount paid to DTSC reflected that liability. Therefore, the 2008 Settlement Agreement reflects an understanding of the parties to settle ASARCO‘s 1989 obligations under the Wickland Agreement. Also instructive is ASARCO‘s parent‘s objection to the terms of the 2008 Bankruptcy Settlement, withdrawn after clarification and a stipulation among the parties that the 2008 Bankruptcy Settlement did not go beyond ASARCO‘s responsibilities under the Wickland Agreement. While ASARCO‘s contention that there are items in DTSC‘s remedial action objectives that differ from the intermediate remedial measures in the Wickland Agreement is valid, those changes are the mandate of an overseeing government agency. The Wickland Agreement definеs such mandated costs as “necessary and appropriate,” and apportions that liability according to the intent of the parties. Therefore, the $33 million that ASARCO agreed to pay to DTSC in the 2008 Bankruptcy Settlement to satisfy ASARCO‘s obligations to clean up the Selby Site is not a new cost, and it cannot underlie a new claim for contribution.
ASARCO contends that the phrase “such costs or damages” in the statute of limitations means that ASARCO‘s claim for contribution only came about when “such costs or damages” became fixed. ASARCO cites to American Cyanamid Co. v. Capuano, 381 F.3d 6 (1st Cir. 2004), but that case held that a new claim for contribution based on new settlement liability (groundwater) cannot be barred by an earlier settlement for a different contribution claim (soil). Id. at 25–26. ASARCO also cites to a Sixth Circuit case in an attempt to bolster the point that only costs fixed in a settlement are eligible in contribution. See RSR Corp. v. Commercial Metals Co., 496 F.3d 552, 559 (6th Cir. 2007). But the Sixth Circuit found that the future costs sought in that action were imposed as part of a judicially approved settlement, and found that the statute of limitations had expired. Id. at 558. “Rather than focus on who settled the cost-recovery action, in short, the statute asks us to focus on what was settled.” Id. at 557. In this appeal, ASARCO‘s new contribution claim via the 2008 Bankruptcy Settlement is for exactly the same liability ASARCO assumed in the 1989 Wickland Agreement, and is therefore time barred.
IV. The 2008 Bankruptcy Settlement Did Not Create a New Claim or Revive the Expired Claim.
ASARCO argues that even though it failed to pursue a
ASARCO is correct that there is no limit in the statute to prevent a party in an early settlement from seeking contribution related to a later settlement, as long as those settlements cover separate obligations. See Am. Cyanamid, 381 F.3d at 25–26. ASARCO is also correct that there is an express right to seek contribution from other PRPs following a settlement with the government, according to
of limitations periods in this setting is to ensure that the responsible parties get to the bargaining—and clean-up—table sooner rather than later.” RSR Corp., 496 F.3d at 559. If the right to seek contribution on an otherwise expired claim was allowed after fixing costs with the government, then any PRP seeking to fix the costs of privately-apportioned CERCLA liability through a bankruptcy settlement with the government would receive a benefit that it had not paid for in that bankruptcy settlement. Such a right would circumvent the statute of limitations for сontribution actions and would encourage tardy parties to use bankruptcy to revive their expired claims. It would also serve to discourage private party settlements and diligent pursuit of contribution claims following the entry of such settlements. If the principal purpose of the limitations period is to ensure that responsible parties get to the “bargaining and clean-up table” sooner rather than later, then potentially responsible parties must be brought to that table within three years of the statute-of-limitations triggering event, and once the statute of limitations has expired on that cause of action, potentially responsible parties cannot revive the expired contribution claim through a subsequent bankruptcy settlement with the United States or a State.
The judgment of the district court is AFFIRMED.