ATLANTIC RICHFIELD CO. V. GREGORY A. CHRISTIAN ET AL.: CAN STRICT LIABILITY BE TOO STRICT?

• Author: Jennings, Rachel

1. INTRODUCTION 269 A. Background 272 B. Montana's Common Law Restoration Damages Claims 273 C. Christian v. Atlantic Richfield Co.: What a Long, Strange Trip It Has Been 274 II. Atlantic Richfield Co. v. Christian: What Goes Around, Comes Around. 275 A. Does a Landowner at a Superfund Site Qualify as a "Potentially Responsible Party" Even if the EPA has Never Ordered the Landowner to Pay for a Cleanup?. 277 1. Arguments Below and Disposition by the Montana Supreme Court. 278 2. Arguments in the United States Supreme Court Briefing 280 a. "Covered Persons" Under Section 107 vs. "Potentially Responsible Parties" Under Section 122 281 b. Operation of CERCLA's Statute of Limitations. 282 c. Property Owners as "Contiguous Landowners". 283 III. Likely Outcome at the United States Supreme Court. 284 A. The Justices' Questions at Oral Argument 284 1. ARCO's Argument, 285 2. The Government's Argument. 285 3. The Property Owners' Argument, 287 B. Canons of Statutory Interpretation., 289 1. Plain Meaning Rule 289 2. Whole Act Rule. 290 3. Harmonious Reading Canon 290 4. No Elephants in Mouseholes, 291 C. Likely Outcome. 291 D. Implications of Finding PRPs are Covered Persons and Vice Versa 292 IV. Conclusion 293 V. Addendum 294 A. CERCLA's Six-Year Statute of Limitations Does Not Preclude PRP Status 294 B. "Covered Persons"and PRPs Are Not Two Distinct Groups of Persons 295 C. The Government's Failure to Comply with CERCLA's Notification Requirements in Section 122(e)(1) is Simply an Exercise in Enforcement Discretion and Does Not Change the Property Owners' Status as PRPs. 297 D. The Property Owners Do Not Satisfy the Statutory Requirements for Invoking CERCLA's "Contiguous Landowner"Defense Against Liability. 297 E. Conclusion 299 EDITOR'S NOTE: This Comment was originally written prior to publication of the Supreme Court's Opinion and thus Part V is a later-added addendum discussing the Court's holdings.

1. INTRODUCTION

   On December 3, 2019, the Supreme Court of the United States heard oral argument for the case titled Atlantic Richfield Co. v. Gregory Christian, (ARCO), (1) a case involving one of the largest and oldest Superfund (2) sites in the U.S.--the Anaconda Smelter. (3) This case chronicles the conflict between one of America's dirtiest industries (4) and the residents who suffered while the Smelter thrived.

   The underlying appellate court case, Gregory Christian v. Atlantic Richfield Co. (Christian) (5), and the ARCO appeal raised issues of first impression for both the Montana state courts and the United States Supreme Court. This case revealed tensions between the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), (6) a complex federal statute, and areas of authority traditionally left to the states--namely land use and property ownership--resulting in questions of federal supremacy, due process, and statutory construction.

   This Comment will start with a brief background of the Anaconda Smelter Superfund site and the relevant state law-based restoration damage claims. Next is a discussion of the Montana Supreme Court's ruling on the petition from Atlantic Richfield Co. (ARCO) for Writ of Supervisory Control against the Montana Second Judicial District Court (7), and ARCO's subsequent petition for certiorari at the United States Supreme Court. (8)

   ARCO presented three issues to the Court:

   1) whether a common law claim for restoration seeking cleanup remedies that conflict with the EPA-ordered remedies is a "challenge" to the EPA's cleanup jurisdictionally barred by section 113 of CERCLA;

   2) whether a landowner at a Superfund site is a "potentially responsible party" (PRP) that must seek the EPA's approval under CERCLA section 122(e)(6) before engaging in remedial action, even if the EPA has never ordered the landowner to pay for a cleanup; and

   3) whether CERCLA preempts state common law claims for restoration that seek cleanup remedies that conflict with EPA-ordered remedies. (9)

   This Comment focuses on the second of these issues: whether a landowner is a PRP.

   The parties agreed that the Property Owners qualified as "covered persons" under section 107(a) of the statute, (10) but they disagreed that covered persons and PRPs are synonymous classifications. This issue will likely determine the outcome of the appeal because the first and third questions are generally quickly disposed of by the Court. (11) The first question asks whether CERCLA deprives state courts of jurisdiction over state law claims relating to contamination at a Superfund site, but it is unlikely the Court would divest state courts of state law claims, considering the "arising under" language that removes federal jurisdiction in the CERCLA statute. The Court has routinely held that "arising under" means the cause of action itself is based on the statute--which clearly would not apply to state common law claims. (12) The third question asks whether CERCLA preempts state common law claims for restoration damages, implicating federal preemption--a question the Court routinely avoids when possible. (13)

   Thus, the outcome of this appeal hinged on whether the Court found that the Property Owners qualified as PRPs under CERCLA. The importance of this question should not be underestimated. Whether the Property Owners, who were expressly absolved of any possible liability by the Environmental Protection Agency (EPA) throughout litigation, would somehow become PRPs under CERCLA after over thirty-five years of the EPA's involvement at the site, and only just before ARCO's filing of its petition for certiorari to the Court, raises serious due process concerns for individuals living within Superfund sites.

   Part II focuses on the parties' briefing. This section considers the arguments made in the state court proceedings for each side and the arguments made in the Supreme Court briefing, focusing only on the PRP issue. Oral argument is discussed separately.

   Part III distills the likely outcome of the PRP issue by analyzing the Justices' participation at oral argument, the Court's canons of statutory construction, and examines some of the implications that may result from the proposed likely outcome of the Supreme Court appeal. This is followed by a brief conclusion in Part IV. (14)

   It is important to note at the outset that the issues on appeal involved only a single type of damages claimed--restoration damages under Montana law (15)--out of the five total pending types of damages sought. (16) Regardless of the outcome of this appeal, the case will almost certainly proceed to trial in Montana state court following the Court's disposition. (17)

   1. Background

      The Anaconda Copper Mining Company first began construction on the Anaconda Smelter, located near Opportunity and Crackerville, Montana, in 1883. (18) By 1906, the Smelter was processing upward of 9,000 tons of ore every twenty-four hours. (19) Then, in 1918, construction began on what is known as the Washoe Big Stack. (20) This brick stack, completed in 1919, was the largest free-standing brick structure in the world--thirty feet taller than the Washington Monument. (21) ARCO merged with the Anaconda Copper Mining Company in 1977 and briefly took over operation of the Smelter until the Smelter's ultimate closure in 1980. (22) 1980 also marked the enactment of the CERCLA statute. (23)

      In 1983, the Smelter site was added to the EPA's National Priority List. (24) In 1984, the EPA issued its first administrative order to ARCO to begin inspection of the site for hazardous waste contamination. (25) The EPA did not officially select a cleanup plan outlining ARCO's cleanup responsibilities at the site until 1998. (26) Over twenty years later, cleanup is ongoing. (27) The EPA estimates that cleanup efforts will not be completed until 2025, and may continue indefinitely. (28) To this day, the Washoe Big Stack remains one of the most recognizable structures in the state. (29)

   2. Montana's Common Law Restoration Damages Claims

      The restoration damages claim made by the Property Owners, which is the subject of the ARCO appeal, is based on Montana common law. The primary authority lies in the Montana Supreme Court's decision in Sunburst School District No. 2 v. Texaco, Inc. (Sunburst). (30) The goal of restoration damages is to "compensate a plaintiff more effectively than diminution in value under certain circumstances." (31) In order to make a restoration damages claim, a plaintiff must demonstrate that the damage to her property is reasonably abatable, and that she has "reasons personal" for remaining on the contaminated property and seeking restoration. (32) Further, the plaintiff must demonstrate that the funds sought will be used for the restoration plan presented to the factfinder. (33) Any funds obtained for restoration damages are then put into a trust and used solely for remediation efforts. (34)

      Although this damages claim is less relevant to the issue of whether the Property Owners are necessarily PRPs, it is important in that ARCO and the Government rely on section 122(e)(6) to preclude the Property Owners' plan. This section prohibits any PRP from undertaking remedial activities within an active Superfund site absent the EPA's prior approval. (35) Because an award of restoration damages under Montana law must be put in a trust and used only for remedial activities, the Property Owners would ultimately be undertaking remedial action within a Superfund site, which is expressly barred by the statute if the Property Owners are held to be PRPs.

   3. Christian v. Atlantic Richfield Co.: What a Long, Strange Trip It Has Been

      In 2008, ninety-eight landowners within the Anaconda Smelter site brought suit against ARCO, the current owner of the site. (36) The landowners brought claims of common law trespass, nuisance, and strict liability against ARCO, and sought state law-based restoration damages. (37) The Property Owners included individuals with generational ties to the...