SYCAMORE INDUSTRIAL PARK ASSOCIATES, Plaintiff-Appellant, v. ERICSSON, INC., Defendant-Appellee.
No. 08-1118
United States Court of Appeals For the Seventh Circuit
ARGUED SEPTEMBER 9, 2008—DECIDED OCTOBER 20, 2008
Before FLAUM, WILLIAMS, and SYKES, Circuit Judges.
FLAUM, Circuit Judge. In 1985, plaintiff Sycamore Industrial Park Associates bought an industrial property with fixtures, including a boiler-based steam heating system, from defendant Ericsson, Inc. Before it sold the property, Ericsson installed a new natural gas heating system, but it left the old heating system in place. Sevеral years after purchasing the property, Sycamore discovered that the boilers, pipes, and various pipe joints that make up the
I. Background
Ericsson owned the 28-acre property at issue, located in Sycamore, Illinois, for several decades. The property contains nine buildings where Ericsson manufactured electrical wiring and cable. During most of Ericsson‘s ownership of this property, the buildings were heated by the boiler system. The boilers are large mechanical units and are anchored to the floor of the two buildings that house them. They are connected to the other buildings through a pipe network. Most of the pipe network runs near the ceilings of the several buildings and is connected to the structures at intervals by metal fasteners. All of the insulated piping is located inside the various structures of the facility except for two areas where the piping extends between buildings. The insulated piping that extends between buildings is encased in a mechanical piping chase or in a metal casing. To maximize thermal
In January 1983, Ericsson ceased all of its manufacturing operations at this facility and sought to sell it to a third party. Soon thereаfter, an Ericsson employee, Michael Kreiger, decided that he would like to purchase the property and operate it as an industrial park. Kreiger was Ericsson‘s vice president for managing services and purchases and was in charge of managing the Sycamore property for Ericsson.
Meanwhile, in the winters of 1983 and 1984, the boiler-based heating system was experiencing difficulty and needed costly repair and maintenance. In December 1984, while negotiating to sell the property to Kreiger, Ericsson leased part of the property to UARCO Inc. Before UARCO moved into the site, Ericsson installed asbestos-free natural gas unit heaters in the parts of the facility that UARCO would occupy.
In late 1984, Ericsson reached an agreement to sell the property tо Kreiger. Kreiger then partnered with another Ericsson employee, Robert Boey, to form Sycamore Industrial Park Associates as an Illinois general partnership. As soon as the sale was completed, Kreiger would transfer ownership in the facility to the Sycamore partnership.
In the spring of 1985, Ericsson installed additional natural gas unit heaters so that the entire facility could be heated with the new units. Upon installing the new heaters, Ericsson discontinued use of the old boiler-based heaters, but it left the old heating system in place.
The abandoned boiler-based steam heating system has not been used for the purpose of heating the buildings since the 1985 closing. The parties disagree as to whether the system is merely turned off, meaning that it could be utilized again, or whether it is inoperable.
In 2004, Sycаmore discovered asbestos in the insulation that covered the steam boiler system and associated piping. The parties dispute the circumstances under which the asbestos was discovered. Ericsson describes the discovery as the result of a repair and maintenance operation in an attempt to show that Sycamore was contemplating use of the boiler-based system. Sycamore responds that it discovered asbestos during a routine inspection by a prospective tenant and that it was not considering utilizing the old heating system.
Sycamore sued Ericsson, seeking to compel it to remove the asbestos-laden insulation. Sycamore claims that by discontinuing use of the boiler-based heating system containing asbestos insulation but not removing it from the site, Eriсsson violated CERCLA and RCRA. Sycamore also sued under state law nuisance and negligence theories not at issue on appeal.
II. Discussion
A. Standard of Review
This Court reviews a district court‘s grant of a motion for summary judgment de novo. Jackson v. County of Racine, 474 F.3d 493, 498 (7th Cir. 2007). In doing so, all facts and reasonable inferences are construed in the light most favorable to the nonmovant party, Sycamore. Lawson v. CSX Transp., Inc., 245 F.3d 916, 922 (7th Cir. 2001). A district court‘s grant of summary judgment is to be affirmed if “the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.”
CERCLA liability attaches when a plaintiff establishes that: (1) the site in question is a “facility” as defined by CERCLA; (2) the defendant is a responsible party; (3) there has been a release or there is a threatened release of hazardous substances; and (4) thе plaintiff has incurred costs in response to the release or threatened release.
CERCLA states that a prior owner of a facility is a responsible party if it controlled the site “at the time of disposal” of a hazardous substance.
[D]ischarge, deposit, injection, dumping, spilling, leaking, or placing of any solid waste or hazardous waste into or on any land or water so that such solid waste or hazardous wаste or any constituent thereof may enter the environment or be emitted into the air or discharged into any waters, including ground waters.
One issue that arises is whether the asbestos-laden boiler system is solid or hazardous waste. While CERCLA purports to cover both solid and hazardous waste, in order to be hazardous waste the material must be solid waste because the statute defines “hazardous waste” as “a solid waste, or combination of solid wastes, which because of its quantity, concentration, or physical, chemical, or infectious characteristics” may be hazardous.
Sycamore argues thаt Ericsson disposed of the asbestos materials when it abandoned them in place and then
In G.J. Leasing v. Union Electric Company, the plaintiffs advanced an argument very similar to Sycamore‘s argument here: that Union Electric disposed of a hazardous substance when it sold real estate cоntaining asbestos. In that case, Union Electric sold a power station consisting of power generation equipment housed in a structure with significant amounts of asbestos in the walls. G.J. Leasing, 54 F.3d at 382-84. In G.J. Leasing, we determined that the mere sale of property containing a hazardous substance is not a disposal imposing liability. Our decision in G.J. Leasing emphasized that the only exposure to asbestos was inside the building; there was no apparent danger to air, land, or water outside of the building as required for “disposal.” Id. at 383. We acknowledged that if the primary purpose and likely effect of the sale was to remove the asbestos in circumstances that would make the release of asbestos to the outside environment inevitable, the transferor could be held liable under CERCLA. But without such intent and likely effect, we concluded that asbestos abandoned in place in a structure did not lead to CERCLA liability. Id. at 385.
The Ninth Circuit reached the same conclusion in Stevens Creek, 915 F.2d 1355. Our sister Circuit determined there was no private cause of action under CERCLA for the sale of a building containing materials with asbestos because the defendant never “disposed” of a hazardous substance. It reasoned that asbestos built into a building
G.J. Leasing and Stevens Creek are on point here. All asbestos insulation at the Sycamore facility is either inside a building or enclosed in a pipe chase or metal case.1 There is no real threat that asbestos “or any constituent thereof may enter the environment or be emitted into the air or dischаrged into any waters, including ground water,” as CERCLA requires in
Sycamore attempts to distinguish G.J. Leasing and Stevens Creek. It argues that in those cases the asbestos-containing material was being used for its intended purpose (to insulate structures), whereas in the instant case the asbestos insulation was no longer serving a
It is worth noting that in G.J. Leasing we also pointed out practical reasons why “the sale of a product which contains a hazardous substance cannot be equated to the disposal of the substance itself or even the making of arrangements for its subsequent disposal.” Id. at 384. As we noted, a contrary rule would mean that sale of an automobile is an arrangement for disposal of a hazardous substance because every аutomobile contains lead in the battery. Id. We carved out an exception to this general principle, recognizing that an owner who wants to get rid of a toxic retaining pond, for example, cannot avoid CERCLA “arranger” liability merely by selling his entire facility, which includes the pond, to an unsuspecting purchaser. We described the toxic retaining pond example as the “maliciоus motive case.” Id. We also recognized a third category of cases, the “mixed-motive case,” in which a seller‘s intent is both to dispose of
Even if we wеre to find that Ericsson is a responsible party, CERCLA also requires that there has been a release or there is a threatened release of hazardous substances. There is substantial overlap in terms used to define “disposal” and “release,” so analysis of the “release” element required for CERCLA liability inevitably overlaps with “responsible party” analysis. See Carson Harbor Village, Ltd. v. Unocal Corp., 270 F.3d 863, 879 (9th Cir. 2001). CERCLA defines a “release” as “any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment.”
The asbestos at the Sycamore facility is contained inside the buildings of the facility or, in the instances when insulated piping runs betwеen buildings, is enclosed in a
C. RCRA Claim
The RCRA сitizen suit provision states, in relevant part, “any person may commence a civil action . . . against any person, . . . who has contributed or who is contributing to the past or present handling, storage, treatment, trans-
To establish RCRA liability, Sycamore must show that Ericsson “handled, stored, treated, transported, or disposed of” solid or hazardous waste. Sycamore first argues that Ericsson “disposed” of the boiler-based heating system when it abandoned the system in place. The definition of “disposal” is the same under RCRA and CERCLA, because RCRA also adopts the definition from the Solid Waste Disposal Act, which is its predecessor statute.
Sycamore argues in the alternative that even if Ericsson did not dispose of the asbestos insulation, Ericsson is nonetheless liable because it handled and stored the asbestos insulаtion. Yet Sycamore presents no evidence that Ericsson handled, stored, or even touched any part of the heating system. In fact, there is no evidence that
III. Conclusion
For the foregoing reasons, we AFFIRM the district court‘s grant of summary judgment for defendant.
10-20-08