Navigating CERCLA Settlements in an Age of Uncertainty: Fallout From Ameripride Services v. Texas Eastern Overseas

• Date: 01 September 2015
• Author: Barry M. Hartman, Christopher A. Jaros, and Elizabeth M. Elliott

45 ELR 10846 ENVIRONMENTAL LAW REPORTER 9-2015

I. Introduction

In April 2015, the U.S. Court of Appeals for the Ninth Cir-

cuit issued a decision in Ameripride Services, Inc. v. Texas

Eastern Overseas, Inc.1 that could signic antly impact pri-

vate parties’ settlement strategy at multiparty sites subject

to the Comprehensive Environmental Response, Com-

pensation, and Liability Act (CERCLA).2 In vacating and

remanding a decision by the Eastern District of California,

the Ninth Circuit held that courts have discretion under

CERCLA §113(f)(1) to determine, ba sed on the facts of

the particular case, the most equitable method of account-

ing for settlements between private parties in a contribu-

tion action,3 and thus can choose the proportionate share

approach adopted by the Uniform Comparative Fault Act

(UCFA),4 the pro tanto approach adopted by the Uniform

Contribution Among Tortfeasors Act (UC ATA), or some-

thing dierent.5

e Ni nth Circu it decision is in di rect conict with

Akzo Nobel Coatings, Inc. v. Aigner Corp., a 1999 U.S.

Court of App eals for t he Seventh Ci rcuit decision hold-

ing that cou rts must use the pro tanto appr oach under

the UCATA, and further wide ns the split among various

circu it cou rts over which a pproach is appropriate under

CERCL A.6 Until t he circu it split is resolved, responsi-

ble pa rtie s deciding when and how to sett le third-pa rty

contribution cl aims should careful ly consider the law of

the circuit where t he proper ty is loc ated, a s the dier-

1. 782 F.3d 474, 45 ELR 20066 (9th Cir. 2015).

2. 42 U.S.C. §§9601-9675, ELR S. CERCLA §§101-405.

3. 42 U.S.C. §9613(f)(1).

4. UCFA §2.

5. UCATA §4. e pro tanto approach refers to UCATA §4(a)’s provision that

the value of the injured party’s claim against the remaining tortfeasors is to

be reduced by the dollar value of the settlement.

6. 197 F.3d 302, 30 ELR 20180 (7th Cir. 1999).

C O M M E N T S

Navigating CERCLA Settlements

in an Age of Uncertainty:

Fallout From Ameripride Services

v. Texas Eastern Overseas

by Barry M. Hartman, Christopher A. Jaros, and Elizabeth M. Elliott

Barry M. Hartman is a Partner with K&L Gates LLP in Washington, DC. Christopher A.

Jaros and Elizabeth M. Elliott are associates in the rm’s Charleston, SC, oce.

ent approac hes may require signicant ly dierent set tle-

ment st rateg ies.7

II. CERCLA Contribution Claims and the

Interplay of the UCATA and the UCFA

e impact of the Ninth Circuit’s decision in Ameripride

hinges primarily on the d ierence in treatment of CER-

CLA contribution settlements under the UCFA and the

UCATA. us, understanding the general framework of

CERCLA contribution actions, as well as the dierent

approaches for valuing contribution settlements, is critical

to determining the potential impact of contribution claim

settlements on responsible parties.

Due to the broad scope of CERCLA liability and the

nature of historical industrial activity in the United States,

it is very common for multiple par ties to have responsi-

bility for some portion of the contamination at any given

site. Because CERCLA imposes joint and several liability

on responsible parties, the U.S. Environmental Protection

Agency (EPA) often targets one responsible party to fund

the remediation. In turn, CERCLA §113 permits the party

incurring remedial costs to seek contribution from the

other responsible parties.8 As a result, owners or primary

contributors at multiparty sites frequently enter into indi-

vidual agreements with EPA (or state regulators) to con-

duct or pay for a cleanup, and then seek contribution from

other responsible parties. is allows the remediating party

to maintain control over the cleanup w ithout signicant

7. e principles and considerations described in this Comment apply not

only to contribution actions under CERCLA, but also more generally to

contribution actions under other similar statutory regimes where courts are

required to account for defendants that settle before trial.

8. 42 U.S.C. §9613(f)(1). Only those costs deemed to be “consistent with the

[National Contingency Plan]” may be recovered under CERCLA §113. See

42 U.S.C. §9607(a)(4).

Copyright © 2015 Environmental Law Institute®, Washington, DC. Reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.