New Jersey Law

Third Circuit confirms that the U.S. did not control the pollution related operations of chromium manufacturing facilities, and therefore, was not an “operator” under CERCLA.

On May 4, 2020, the Third Circuit issued an opinion in PPG Industries, Inc. v . United States in which it affirmed summary judgment granted to the U.S. on PPG’s claims that the government is subject to liability under CERCLA as a former operator of chromium manufacturing plants in Jersey City currently owned and being remediated by PPG. The company argued that the U.S. should be considered subject to operator liability because it had regulated prices and labor, secured financing for facility expansion designed to conserve chromium, and directed its distribution during World Wars I and II. In holding for the U.S. the Circuit Court confirmed that the standard for determination of operator liability under the U.S. Supreme Court decision, United States v. Best Foods, focuses on the relationship between the purported operator and the facility at issue, and on “operations specifically related to pollution.” Actions that demonstrate control according to the Third Circuit decision requires more than general control over an industry or a facility, it requires “some indicia of control” of the polluting activities of the facility, which include “operations that have to do with the leakage or disposal of hazardous wastes or decisions about compliance with environmental regulations.” The Court went on to confirm that mere knowledge of the waste disposal practice is not the same as undertaking the practice of waste disposal when considering CERCLA liability. The Court also confirmed that the test from Best Foods is not limited to private enterprises but also the public entities. As there was no evidence that the actions of the United States did not involve activities specifically related to pollution, the decision of the district court granting summary judgment to the U.S. was affirmed.

For additional information about the matters in this bulletin or in the firm’s Environmental Practice, please contact Steven A. Kunzman, Esq