State of NEW YORK, Joseph Martens, as Commissioner of the New York State Department of Environmental Conservation v. NEXT MILLENIUM REALTY, LLC, 101 Frost Street Associates, L.P., 101 Frost Street Corporation, Pamela Spiegel Sanders, as Executor of the Last Wills and Testaments of, and duly authorized Administrators of the Estate of, Emily Spiegel and Jerry Spiegel, Lise Spiegel Wilks, as Executor of the Last Wills and Testaments of, and duly authorized Administrators of the Estate of, Emily Spiegel and Jerry Spiegel, Island Transportation Corporation, Utility Manufacturing Co., Inc., Nest Equities, Inc., Audie Kranz, Wilbur Kranz, Kamal Chopra, Tishcon Corp., a/k/a Tishcon Corporation, Joe Elbaz, Grand Machinery, Inc., William Gross, Arkwin Industries, Inc., William Maglio, as Executor of the Last Will and Testament of, and duly authorized Administrator of the Estate of, defendant Daniel Berlin, Frank Jacobson, as Executor of the Last Will and Testament of, and duly authorized Administrator of the Estate of, defendant Daniel Berlin, Thomas Malloy, Equity Share I Associates, Barouh Eaton Allen Corp., 2632 Realty Development Corporation, Richard Degenhart, Atlas Graphics, Inc., H.D.P. Printing Industries Corp., IMC Eastern Corporation, f/k/a IMC Magnetics Corp., NMB (USA) Inc., Paul Merandi, C & O Realty Co., Sulzer Metco (US) Inc., Jerry Goodman, Emily Spiegel, as Trustee under an Agreement of Trust for the benefit of Pamela Spiegel and Lisa Spiegel, Scibelli Brothers Auto Collision, Inc., Joseph Scibelli, Sam-Ton Towing & Salvage Inc.
Docket No. 12-2894-cv
United States Court of Appeals, Second Circuit
Decided: Oct. 15, 2013
Argued: May 13, 2013. Corrected: Oct. 16, 2013.
732 F.3d 117
Barbara D. Underwood, Solicitor General (Cecelia C. Chang, Deputy Solicitor General, Matthew W. Grieco, Assistant Solicitor General, on the brief), for Eric T. Schneiderman, Attorney General of the State of New York, New York, N.Y., for Plaintiffs-Appellants.
Kathleen M. Sullivan (William B. Adams, on the brief), Quinn Emanuel Urquhart & Sullivan, LLP, New York, N.Y., and Kevin Maldonado, Kevin Maldonado & Partners LLC, Windham, New York, for Defendants-Appellees Next Millennium Realty, LLC, 101 Frost Street Associates, L.P., 101 Frost Street Corporation, Pamela Spiegel Sanders, as Executor of the Last Wills and Testaments of, and duly authorized Administrators of the Estate of, Emily Spiegel and Jerry Spiegel, Lise Spiegel Wilks, as Executor of the Last Wills and Testaments of, and duly authorized Administrators of the Estate of Emily Spiegel and Jerry Spiegel, Emily Spiegel, as Trustee under an Agreement of Trust for the benefit of Pamela Spiegel and Lisa Spiegel.
Paul B. Sweeney and Barry S. Cohen, Certilman Balin Adler & Hyman, LLP, East Meadow, N.Y., for Defendant-Appellee Equity Share I Associates.
John Gregory Martin and Suzanne M. Avena, Garfunkel Wild, P.C., Great Neck, N.Y., for Defendants-Appellees Arkwin Industries, Inc., William Maglio, as Executor of the Last Will and Testament of, and duly authorized Administrator of the Estate of, defendant Daniel Berlin, Frank Jacobson, as Executor of the Last Will and Testament of, and duly authorized Administrator of the Estate of, defendant Daniel Berlin, Thomas Malloy.
Miriam Villani, Sahn Ward Coschignano & Baker, PLLC, Uniondale, N.Y., for Defendants-Appellees Audie Kranz, Wilbur Kranz, Nest Equities, Inc., and Utility Manufacturing Co., Inc.
Thomas R. Smith, Bond, Schoeneck & King, PLLC, Syracuse, N.Y., for Defendant-Appellee Barouh Eaton Allen Corp.
Kenneth L. Robinson, Robinson & Associates, P.C., Syosset, New York, and Theodore Warren Firetog, Law Offices of Theodore W. Firetog, Farmingdale, N.Y., for Defendants-Appellees Richard Degenhart, Atlas Graphics, Inc., and H.D.P. Printing Industries Corp.
Robert R. Lucic, John E. Peltonen, and Daniel K. Fink, Sheehan Phinney Bass & Green, P.A., Manchester, New Hampshire, for Defendants-Appellees IMC Eastern Corporation, f/k/a IMC Magnetics Corp., and NMB (USA) Inc.
Sheila A. Woolson, Epstein Becker & Green, P.C., Newark, NJ, for Defendant-Appellee Island Transportation Corporation.
Richard P. O‘Leary, McCarter & English, LLP, New York, N.Y., for Defendant-Appellee Sulzer Metco (US) Inc.
Before: CHIN and LOHIER, Circuit Judges, and SWAIN, District Judge.*
In this case, the State of New York (the “State“) sued defendants-appellees under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
The district court (Feuerstein, J.), adopting a report and recommendation of the magistrate judge (Orenstein, M.J.), granted defendants’ motion for summary judgment and dismissed the action as time-barred. The district court held that the State‘s claims were barred by the six-year statute of limitations governing suits to recover costs for remedial actions—that is, measures to permanently remediate hazardous wastes—set forth in
The State argues that the cleanup activities in question are removal actions—that is, measures taken to address immediate threats to public health—and that suits to recover costs for removal actions are governed by the three-year statute of limitations set forth in
We agree that the State‘s action is timely. We hold that the cleanup activities here were implemented as removal measures and continued to be removal measures at all relevant times. Accordingly, the district court erred in applying the statute of limitations for remedial rather than removal actions, and we vacate and remand for further proceedings consistent with this opinion.
STATEMENT OF THE CASE
A. The Contamination and Investigation
The NCIA, a 170-acre site in North Hempstead, New York, sits on top of a sole source aquifer1 in which groundwater flows approximately 55 to 65 feet below the ground surface. In the early 1950‘s, the NCIA was home to a variety of light industries. A number of these industries were involved in activities that produced volatile organic compounds (“VOCs“), which eventually found their way into the groundwater.2
In 1986, the Nassau County Department of Health (the “County Health Department“) uncovered groundwater contamination at the NCIA. As a consequence, in 1988 the New York State Department of
1. The GAC
In 1989, the Town detected VOCs in two of its water supply wells at levels approaching New York State Maximum Contaminant Levels for drinking water.4 These wells were located in the Bowling Green Estates Water District and were approximately 1,500 feet from the NCIA in the direction of the flow of groundwater. The Town hired Dvirka and Bartilucci (“D & B“), an engineering firm, to investigate. In November 1989, D & B confirmed the presence of VOCs in the water, including trichloroethylene and tetrachloroethylene, likely carcinogens, and recommended the installation of a granulated activated carbon adsorption system (the “GAC“) to remove the VOCs. A GAC eliminates contaminants by pumping untreated water from the wells through carbon units and discharging the water into a groundwater storage reservoir. As the carbon bed reaches its useful adsorption capacity, however, its effectiveness diminishes considerably.
In the fall of 1990, the Town bought and installed a GAC at the site of the two wells. On June 15, 1993, the County Health Department approved the GAC for full operation. The GAC commenced operations, and it has remained in operation since.
2. The Air Stripper Tower
From December 10, 1990 through May 30, 1995, the Town found that rising concentrations of VOCs had “markedly increased” the cost of running the GAC system. As Hempstead Water Commissioner Daniel Davis (“Commissioner Davis“) explained:
During this period [from December 1990 through May 1995], I became concerned that the increasing concentrations of VOCs would soon render the GAC Treatment System ineffective and too costly or impractical to operate. My concerns led me to consider supplementing the GAC Treatment System in order to improve efficiency and lower the costs of operation.
(Davis Decl. ¶ 16). Commissioner Davis asked D & B to recommend a system to supplement the GAC. In May 1995, D & B proposed an air stripper tower—a packed tower aeration system. The air stripper tower, which rests on a large concrete slab, treats the water before it is collected in a clearwell and then pumps the water to the GAC.
On June 12 and 13, 1995, the Town took exploratory soil borings to determine whether the soil could bear the weight of an air-stripper tower. The Town awarded the contract to construct the air stripper tower in July 1995. Construction began in July 1995 and was completed in 1997. The air tower commenced operations, and it has remained in operation since.
3. The DEC Investigation
The DEC began its remedial investigation of the NCIA in 1995, and thereafter it sampled 41 groundwater monitoring wells between 1996 and 2000, installed four early warning groundwater wells in 1998, and
On May 16, 1995, the DEC and the New York State Department of Health (the “State Health Department“) held a public meeting in Hempstead to address the groundwater contamination. Based on discussions at that meeting, the Town began to suspect the NCIA was the source of the groundwater contamination.
On May 23, 1995, the Town followed up with a letter to the DEC: (1) expressing concern about the “substantial increase in the levels of contamination” in the wells since 1992; (2) requesting consideration for funding for treatment under the New York State Superfund Program; (3) requesting a “full, immediate and intensive investigation by the DEC to determine who all the polluters are so that they will be held accountable for their actions“; and (4) declining to seek compensation for the GAC system already in place.
In 1999, engineers hired by the DEC confirmed the existence of three VOC plumes migrating underground from the NCIA towards the Town. In September 2000, the DEC issued its final remedial investigation/feasibility study report. The report divided the remedial strategy into three parts, and separated the NCIA into three corresponding operable units addressing ground-level contamination within the NCIA, contaminated groundwater directly beneath the NCIA, and the migration of VOC plumes from the NCIA offsite.
In October 2003, the DEC issued the final Record of Decision (“ROD“) selecting a permanent remedy to address the pollution at the NCIA: “Full Plume Remediation of Upper and Deep Portions of the Aquifer (to 225 ft below ground surface) with In-Well Vapor Stripping/Localized Vapor Treatment.” This remedy involved pilot testing, the removal of contaminated soil, the construction of additional in-well vapor stripping wells (groundwater circulation wells), as well as the installation of new monitoring wells and a long-term groundwater monitoring program. It also incorporated the existing GAC and air stripper tower. The DEC estimated the full remediation would cost $8.5 million and take seven years.5
4. Tolling Agreements
The State entered into tolling agreements with a number of potentially responsible parties—owners and operators of facilities within the NCIA—tolling the statute of limitations. The earliest of these agreements came into effect on June 27, 2001.
B. Procedural History
On March 13, 2006, the State filed this cost-recovery suit against defendants pursuant to section 107 of CERCLA,
The district court concluded that the GAC and the air stripper actions were “remedial” and that the actions were attributable to the State. It held that the State‘s claims were subject to the statute of limitations for remedial actions, which bars claims filed more than six years after commencement of construction. The district court then concluded that the statute had begun to run either when the GAC was installed in 1990, or when three foundational borings for the air stripper were drilled on June 12 and 13, 1995. Next Millenium, 2010 WL 8032748, at *12-13. Because the earliest tolling agreement did not come into effect until June 27, 2001—more than six years after construction commenced on June 12, 1995—the district court ruled the State‘s suit, filed on March 13, 2006, was time-barred. Id. at *14.
This appeal followed.
DISCUSSION
A. CERCLA
Congress created CERCLA to address hazardous waste spills by authorizing the United States and the States to commence cleanup with public money and then to seek the recovery of costs from polluters.
We have construed CERCLA liberally to advance the dual goals of cleaning up hazardous waste and holding polluters responsible for their actions. See B.F. Goodrich Co. v. Murtha, 958 F.2d 1192, 1198 (2d Cir.1992) (“Because it is a remedial statute, CERCLA must be construed liberally to effectuate its two primary goals: (1) enabling the EPA to respond efficiently and expeditiously to toxic spills, and (2) holding those parties responsible for the releases liable for the costs of the cleanup.“); Prisco v. A & D Carting Corp., 168 F.3d 593, 602 (2d Cir.1999) (“As a remedial statute, CERCLA should be construed liberally to give effect to its purposes.” (quoting B.F. Goodrich v. Betkoski, 99 F.3d 505, 514 (2d Cir.1996) (internal quotation marks omitted))).
Section 107 of CERCLA authorizes federal and state governments to recover response costs from potentially responsible parties (“PRPs“) for both removal and remedial actions.
Remedial actions are generally actions designed to permanently remediate hazardous waste.
Removal and remedial actions are governed by different statutes of limitations. For removal actions, the government must seek to recoup costs within three years “after completion of the removal action.”
Whether a suit to recover response costs under section 107 of CERCLA is a “removal action” or a “remedial action” is a question of law that we review de novo. W.R. Grace & Co., 429 F.3d at 1234-35 (“Whether the . . . cleanup activity was a removal action or, on the other hand, a remedial action in removal action‘s clothing—is a question of statutory interpretation” and thus, “a legal issue that we review as a matter of law.“); Geraghty and Miller, Inc., 234 F.3d at 925-26 (classification of an activity as “removal” or “remedial” is “determined as a matter of law“). Likewise, to the extent the resolution of this legal question turns on factual issues, we review the district court‘s grant of summary judgment de novo, applying well-settled principles governing summary judgment motions. Lopes v. Dep‘t of Soc. Servs., 696 F.3d 180, 184 (2d Cir.2012).
B. Analysis
We hold that, to the extent it concerns the GAC and air stripper tower, this suit is a “removal action” subject to the three-year statute of limitations, which is triggered by the “completion of the removal action.” Because the removal measures cannot be deemed to have been completed in any sense before the State‘s adoption of a remediation plan that incorporated them, and this action was commenced within three years of that earliest possible date, the statute of limitations had not run as of the time this action was commenced. Hence, we hold that the district court erred in dismissing this action as untimely.
1. The Nature of the Cleanup Measures
We hold that the GAC and air stripper tower were removal measures, for the following reasons.
First, both systems were installed in response to an imminent public health hazard, a defining characteristic of removal actions. See Kalman W. Abrams Metals, Inc., 155 F.3d at 1024; W.R. Grace & Co., 429 F.3d at 1244 (collecting cases). The contamination in Hempstead‘s drinking water posed an immediate threat. As the engineering firm D & B recognized in its November 1989 report:
Wells 1 and 2 at the Iris Place Pump Station have Volatile Organic Compound (VOC) concentrations approaching current New York State Maximum Contaminant Levels for potable water. The wells are critical to the operation of the Bowling Green Water District; consequently, immediate action is required to ensure that the wells remain operational at all times.
Similarly, the Town constructed the air stripper tower in direct response to rising VOC levels that were overwhelming the GAC system and diminishing its effectiveness. After Commissioner Davis grew concerned that the increasing levels of VOCs would “render the GAC Treatment System ineffective and too costly or impractical to operate,” he issued a directive to carry out design work for the air stripper tower to ensure that the Bowling Green wells would be “capable of supplying adequate quantities of potable water to customers in accordance with the New York State Sanitary Code.” (Davis Decl. ¶¶ 16, 17). There is no question these two measures were taken by the Town in response to concerns about the imminent threat to safe drinking water.
Second, both the GAC and the air stripper tower were designed as measures to address water contamination at the endpoint—the wells—and not to permanently remediate the problem by “prevent[ing] or minimiz[ing] the release of hazardous substances so that they do not migrate” from the underlying source of contamination at the NCIA.
The GAC and air stripper tower were implemented as measures to minimize and mitigate the damage from the NCIA, rather than to permanently eliminate it. See
Defendants argue that cleanup actions do not have to address the underlying source of contamination to qualify as “remedial,” citing Morrison Enters., LLC v. Dravo Corp., 638 F.3d 594 (8th Cir.2011). In Morrison, the City of Hastings, Nebraska, removed contaminated wells and installed new wells and water mains to remediate contaminated drinking water. Id. at 600. The City argued that these actions were removal measures because “the work on the water supply system did not clean one molecule of water or rid the environment of any contamination whatsoever.” Id. at 608 (internal quotation marks omitted). The Eighth Circuit disagreed, holding that “retiring contaminated wells and obtaining uncontaminated supplies of water to meet the needs of the City‘s residents for the foreseeable future is more in the nature of a permanent remedy.” Id. In doing so, it relied on the fact that the phrase “provision of alternative water supplies” is found in the definition of “remedial” actions. Id. at 609; see
[t]he City‘s narrow interpretation of the term remedial action would render Congress‘s specific inclusion of the provision of alternative water supplies in the second sentence of the definition a nullity. By its inherent nature, the provision of alternative water supplies never cleans contaminated water, nor rids the environment of contamination.
Morrison, 638 F.3d at 609. Thus, because the measures constituted the “provision of alternative water supplies” and were consistent with the definition of “remedy,” which includes actions to “prevent or minimize the release of hazardous substances,” the court concluded they were remedial.
In contrast, the Town‘s actions in this case do not involve the provision of alternative water supplies. The GAC and air stripper tower were used to remove sufficient amounts of contamination from polluted water to render the water safe to drink. That is hardly the same as retiring contaminated wells and building an entirely new water supply system. Thus, Morrison is inapposite.
Additionally, even though the GAC and the air stripper tower eventually were ultimately adopted as part of a permanent remedial solution, they still constituted “removal” actions at all times relevant to the statute of limitations question. W.R. Grace & Co., 429 F.3d at 1244 (“As a practical matter, removal actions are often permanent solutions such as can be the case in a typical soil or drum removal.“) (quoting EPA Guidance at 3 n. 3 (internal quotations marks omitted)); Geraghty and Miller, Inc., 234 F.3d at 927 (“Even if the replacements for these wells are integral to the long-term remediation of the site, that does not mean that their initial placement cannot be categorized as removal.“). Likewise, even if the GAC and the air stripper tower performed certain functions that might be considered “remedial,” such as “prevent[ing] or minimiz[ing] the release of hazardous substances so they do not migrate to cause substantial danger to present or future public health or welfare,”
Thus, we conclude, as a matter of law, that under the circumstances of this case, these two systems, which were built in response to an immediate health threat and designed to render the drinking water safe without addressing the underlying source of pollution, were “removal” and not “remedial” actions at least up until the time that the State adopted a remediation plan that incorporated them.12
2. Defendants’ remaining arguments
a. The duration and cost of the actions
Defendants argue that the duration and cost of these measures indicate they are remedial actions. They point out that the GAC has been running since 1990 and the air stripper tower since approximately 1997. They also argue that the cost of the projects—the GAC cost $1.25 million and the air stripper tower cost $1.2 million—supports the conclusion that these are remedial actions because they are simply too expensive to be removal actions.
In support of their argument, the defendants point to a section of CERCLA that provides that a removal measure “shall not continue after $2,000,000 has been obligated for response actions or 12 months has elapsed from the date of initial response.”
As an initial matter, defendants concede that “these limits are not binding here since the State performed the response measures,” rather than the federal government. Defs.-Apps.’ Br. at 34. In addition, the GAC and air stripper tower fall within both exceptions as there was an “immediate risk to public health” and the “continued response actions” were required to “prevent, limit, or mitigate an emergency.”
Moreover, the EPA Guidance persuasively provides that neither the cost nor the duration of a project is dispositive in determining whether the project is removal or remedial:
While some courts have looked to [the length of time necessary to complete an action] in distinguishing between removal and remedial actions, this characteristic usually is not helpful; removal actions are most often of short duration, but they certainly can be long-running responses, too, thereby undercutting the probative value of duration . . . in deciding whether an action is removal rather than remedial in nature.
EPA Guidance at 3 n. 2. The EPA Guidance also recognizes that removal actions can involve considerable expense:
[E]ven expensive and complex response actions may be removal action candidates if they are relatively time-sensitive—regardless of whether any further action might ultimately be selected for a site.
Id. at 4.
Because both the GAC and the air stripper tower were urgent responses designed to combat rising levels of VOCs that threatened the water quality, the duration and cost of these measures do not mean that they constituted remedial actions ab initio. See id. at 4 n. 4 (the $2 million and 12 month limitations “apply only to fund-financed actions, and serve as a fiscal check; they are not found in the statutory definition of ‘removal’ and do not control which actions can be taken as removals“).
b. The use of the word “remedial” by the State
The district court found that the State‘s use of the word “remedial” in conjunction with the GAC system and the air stripper tower showed they were remedial measures. Specifically, the State referred to these as “interim remedial measures” and as “remedial” alternatives in the ROD. Next Millenium, 2010 WL 8032748, at *11. In addition, in its interrogatory responses, the State referred to “additional remedial measures in order to complete the remediating of Hazardous Substances.” [Maldonado Decl. in Supp. of Motion for Summ. J., Ex. 7, at 22]. Finally, defendants contend that Jeff Trad, an engineer at the DEC, on one occasion described the air stripper tower as part of the “remediation” of the groundwater in a conversation with Commissioner Davis.
These generic uses of the word “remedial,” however, do not require a finding that the measures were remedial in the statutory sense at the time they were implemented. The word “remedial” is often used in environmental discussions in its common every day sense, namely, “intended as a remedy.” Webster‘s New Collegiate Dictionary 970 (1980); see also Geraghty and Miller, Inc., 234 F.3d at 926 (“[c]onfusion often results because the industry use of ‘remediation’ is not synonymous with CERCLA‘s definition of ‘remedial.’ “). The use of the word by itself does not render an action “remedial” for purposes of the statute of limitations. City of Moses Lake v. United States, 416 F.Supp.2d 1015, 1024 (E.D.Wash.2005) (use of word “remedial” in a “generic sense” in several documents over a thirteen-year period “do[es] not constitute an admission . . . that this cleanup is now in its ‘remedial’ phase as opposed to a ‘removal’ phase” under CERCLA). In its generic sense, “remedy” encompasses both temporary meas-
In short, the Town‘s efforts here—a GAC and an air stripper tower—were removal measures taken to respond to the immediate health concerns presented by contaminated well water while it investigated the source of the contamination and sought to develop a more coherent and fuller response to eliminate permanently the underlying source of the contamination. This action was commenced within three years of the State‘s adoption of a comprehensive remediation plan that incorporated the preexisting removal technologies.
CONCLUSION
For the foregoing reasons, we hold that the cleanup activities at issue were “removal” measures at all relevant times and the State‘s claims are governed by the three-year statute of limitations. Accordingly the State‘s suit is not time-barred and the judgment of the district court is VACATED and this case is REMANDED for further proceedings consistent with this opinion.
DENNY CHIN
UNITED STATES CIRCUIT JUDGE