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Keywords

liabilityappealcorporation

mediationdiscoverystatutecorporation

Related Cases

NCR Corp. v. George A. Whiting Paper Co., 768 F.3d 682, 79 ERC 1241

Facts

NCR Corporation manufactured carbonless copy paper from the mid-1950s to 1971, during which time it used a PCB-based solvent that led to significant environmental contamination in the Lower Fox River. The Environmental Protection Agency (EPA) identified the site for cleanup under CERCLA, and NCR, having incurred substantial cleanup costs, sought contribution from other responsible parties, including recycling mills that had also contributed to the pollution. The district court ruled against NCR's claims for contribution and in favor of the recycling mills' counterclaims, leading to NCR's appeal.

The invention of carbonless copy paper by NCR Corporation in the mid–1950s solved a small problem and created a large one.

Issue

The main legal issues included whether NCR could assert a CERCLA cost recovery claim, whether Appvion could recover costs as a former PRP, and whether the district court abused its discretion in allocating response costs.

The main event, though, relates to the equitable allocation of costs.

Rule

Under CERCLA, parties that have incurred cleanup costs can seek contribution from other responsible parties, but the ability to recover costs depends on whether the party has been subject to a liability determination or enforcement action.

Once the Environmental Protection Agency (EPA) identifies the site of an environmental hazard that requires remediation under CERCLA, the statute's financial responsibility rules are triggered.

Analysis

The court analyzed NCR's claims under CERCLA, determining that NCR could not recover costs under section 107(a) because it had already been subject to liability under section 113(f). The court also found that Appvion, having been erroneously identified as a PRP, could recover its costs under section 107(a) since it was not acting as an indemnitor when it incurred those costs. The court concluded that the district court had abused its discretion in allocating 100% of the response costs to NCR without considering the equitable factors involved.

The district court, after holding a first phase of discovery on the question of when each party became aware that the primary chemical ingredient of carbonless copy paper was harmful, held that NCR was not entitled to any equitable contribution from the paper mills.

Conclusion

The court affirmed in part, reversed in part, and vacated in part the district court's rulings, remanding the case for further proceedings to properly allocate response costs among the responsible parties.

Affirmed in part, reversed in part, vacated in part, and remanded.

Who won?

The prevailing party included Appvion, which was allowed to recover costs as it was found to have been erroneously identified as a PRP. The court reasoned that Appvion's payments were made while it was still considered a PRP, thus entitling it to seek recovery.

Appvion finds itself in a materially different position from NCR when it comes to the choice between cost recovery and contribution.

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