The dividing line between Superfund cost recovery and contribution actions under sections 107(a) and 113(f) of CERCLA, respectively, have long been complicated and unclear. Potentially responsible parties (PRPs) typically prefer to proceed under § 107 due to its more favorable statute of limitations and joint and several liability standard, but often plead both sections alternatively when seeking reimbursement and response costs. Several recent court decisions provide additional clarity as to which section is appropriate given the procedural status of the claim.

In United States v. Atl. Research Corp., 551 U.S. 128 (2007), the Supreme Court held that the availability of remedies under § 107 and § 113 depends on the procedural posture of the case. If a party has settled or otherwise resolved its liability with the federal government or a state for any response costs or has been the subject of a CERCLA action under § 106 or § 107, the party must use § 113 to seek contribution from other potentially responsible parties. However, a party that has voluntarily incurred response costs and is not subject to a settlement or an enforcement action may use § 107(a).

In a lower-court decision that appears consistent with the reasoning of Atl. Research Corp., the U.S. District Court for the Eastern District of Michigan found no authority supporting the proposition that “a party who has incurred voluntary costs and faces future potential liability for further costs in relation to a single site can ‘slice and dice’ the costs into separate claims.” Ford Motor Co. v. Michigan Consol Gas Co., 2015 BL 33780, E.D. Mich., No. 08-cv-13503, 2/10/15.

In light of the Atl. Research Corp. decision, the fact that a party has incurred voluntary costs does not automatically entitle that party to proceed under § 107. While these cases have provided some additional clarity on this issue, there is still not complete certainty regarding which cause of action applies, and full clarity is unlikely to be achieved until the Supreme Court or Congress address the issue directly.

For more information on Superfund cost recovery or other environmental matters, contact Phillip Hoover.