The Burlington Court's Flawed Arithmetic

• Date: 01 July 2010

7-2010 NEWS & ANALYSIS 40 ELR 10637

C O M M E N T S

The Burlington Court’s

Flawed Arithmetic

by Walter Mugdan

Walter Mugdan is Director, Emergency and Remedial Response Division, U.S. EPA, Region 2.

On May 4, 2009, the U.S. Supreme Court handed

down its decision in   

  1 e decision is of

major signicance with respect to t wo areas of Superfund

jurisprudence—“arranger” liability, and divisibility or appor-

tionment of harm. is Article is concerned only with the

latter issue and, moreover, only with one specic element of

that issue.

Much has already been written about this decision, but few

of those writings have focused on the mathematical equation

used by the Burlington court to assign a specic apportioned

share of the liability for the Superfund site in question to the

two defendant railroad companies. e focus of this Article

is the court’s arithmetic, which the author contends is fun-

damentally awed.

I. Facts of the Case

As described in the Supreme Court decision, the facts of the

case (which are critica l to understanding the trial court’s

arithmetic) are these:

Brown & Bryant (B&B) operated an a gricultural-chemi-

cal pack aging and distribution company in California. (See

diagram of facility at the end of this Article.) e company

started operation in 1960. In 1975, it extended its operations

onto an adjacent, sma ller parcel of land owned by two rai l-

road companies that are the corporate predecessors of Bur-

lington Northern and Union Pacic Railroads, t wo of the

chief defendants in this ca se. B&B continued operations at

the combined parcel until 1989.

B&B purchased agricultural chemicals from manufactur-

ers, including Shell Oil Company and Dow Chemical. From

Shell, it purchased chemicals named D-D and Nemagon,

1. 129 S. Ct. 1870, 39 ELR 20098 (2009).

and from Dow, it purchased Dinoseb. Some of the chemi-

cals were purchased in bulk and arrived by common carrier

(truck or rail). Upon arrival, the chemicals were transferred

from the tank trucks or rail cars to bulk storage tanks for

later repackaging and resale.

Spills occurred during the transfer operations, as well

as else where on the site, causing soil and groundwater con-

tamination. In due course, B&B became a Superfund site.

D-D, Nemagon, and Dinoseb were the c ontamina nts of

principle concern.

By the early 1990s, the U.S. Environmental Protection

Agency (EPA) and California had spent some $8 million

on cleanup work. e railroads, under order from EPA, had

spent a further $3 mil lion. (Signicant additional expendi-

tures would later be necessary to complete the cleanup.)

In 1992, the railroads sued B&B to recover costs, and EPA

and California sued the railroads and Shell for cost recovery.

e cases were consolidated.

II. The Litigation

In the Burlington trial, the opposing parties pursued what

the court characterized as a “scorched earth” approach: the

federal and state governments contended that the railroads

were jointly and severally liable for the entire cost of site

cleanup, and so the plaintis did not brief or argue the ques-

tion of how liability might appropriately be apportioned. e

defendants maintained that they should not be held liable

at all, and similarly did not brief or argue the principles or

mechanics of apportionment. e district court held both

railroads and Shell liable, but also held the harm to be divis-

ible. e court apportioned 6% of the liability to Shell, and

then turned its attention to the two railroads. (is Article

will not fur ther consider the question of Shell’s liability, but

will hereafter focus on the railroads’ liability.)

Unaided by informed argument from either side, the

court sua sponte looked to the evidence adduced at trial and

invented a simple mathematical equation, based upon which

it concluded that the railroads apportioned share of the lia-

bility should be 9%.

   

   

      

 

whom the author is indebted.

Copyright © 2010 Environmental Law Institute®, Washington, DC. reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.