The KDDK Advantage
- July/August 2009
“Beware of Your Waste
Stream,”
says U.S. Supreme Court
The United States EPA’s
level of enforcement of environmental laws has dropped
over the last eight years. With a new administration in
Washington, it is anticipated that such enforcement will
rise. To this point, the U.S. Supreme Court just last
month upheld in Burthington Northern and Santa Fe
Railroad Co., et. al. v. United States that “arranger”
liability for waste will be apportioned to a product supplier
for clean-up costs, if the government or landowner can
prove “intentional steps to dispose of (versus sell) the
product containing hazardous substance” was taken by a
supplier or transporter.
Businesses that use in
their products or generate hazardous wastes may be well
served to heed these warning signs by taking a closer
look at whether their environmental house is in order.
The Burthington Northern case amplifies that
where a business is selling a product for recycling, and
not disposal, they should maintain adequate documentation
of this intent. The client may also need to prove such
item being recycled was a product in which there was an
aftermarket for its sale. For many suppliers, this means
where one contracts with a used oil or battery reclaimer,
it is important that the contract be precisely worded
to protect against such liability. This can become especially
costly should the recycler later engage in practices that
adversely affect the environment. Unless such intent to
sell, not dispose, is documented, business owners may
continue to find themselves surprised to receive EPA notices
seeking recovery. Often such notices are for millions
of dollars of clean-up costs, at sites often unbeknownst
to business managers.
The Burthington Northern
case not only provided a determination for when a business
might be liable, but also on what basis the allocation
of such liability may be apportioned. The Supreme Court
upheld that the use of standards such as geography, time,
and volumetric estimates can prove valuable to preventing
one from having joint and several liability for the entire
site. In summary, the protection and preservation of business
records may in many cases prove valuable in limiting the
liability and dollar costs for businesses in such cases.
Environmental audits are
a common method employed by clients to mitigate or prevent
environmental liability risks. When conducted by legal
counsel, such audits may be conducted while preserving
the confidentiality of such information during the process.
KDDK has counseled many in conducting such environmental
audits.
Kahn, Dees, Donovan
& Kahn, LLP regularly engages in environmental due
diligence efforts as part of business and real estate
transactions on behalf of individuals, banking, commercial
and manufacturing entities. As part of these efforts,
KDDK helps in the recovery of defense and indemnity costs
for environmental site investigations, enforcement actions
and clean-ups from historical CGL policies and prior titleholders.
For more information regarding our environmental law practice
or for assistance with an environmental matter, please
call one of our environmental law attorneys: G.
Michael Schopmeyer, Jeffrey
W. Ahlers, Kent
A. Brasseale II, Monica
E. Edwards and Michael
E. DiRienzo.
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In The Environmental Realm, Sometimes A Contract Is Not
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