Carson Harbor Village, Ltd. v. Unocal Corporation

U.S. Court of Appeals10/24/2001
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270 F.3d 863 (9th Cir. 2001)

CARSON HARBOR VILLAGE, LTD., A LIMITED PARTNERSHIP DBA CARSON HARBOR VILLAGE MOBILHOME PARK, PLAINTIFF-COUNTER-DEFENDANT-APPELLANT,
v.
UNOCAL CORPORATION, A DELAWARE CORPORATION, DEFENDANT-CROSS-DEFENDANT, AND CITY OF CARSON, DEFENDANT-CROSS-DEFENDANT-CROSS-CLAIMANT-APPELLEE.

Nos. 98-55056, 98-55107, 98-55210, 98-55213, 98-55215 and 98-55422

UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

Argued and Submitted September 13, 1999
Filed September 14, 2000
Rehearing En Banc Granted and Opinion Withdrawn February 13, 2001
Argued and Submitted June 19, 2001
Filed October 24, 2001

[Copyrighted Material Omitted][Copyrighted Material Omitted]

Frank Gooch III (argued), Gilchrist & Rutter, Santa Monica, California, and Christopher M. Amantea (argued), McDermott, Will & Emery, Los Angeles, California, for plaintiff-appellant Carson Harbor Village, Ltd.

Lisa Bond (argued), Richards, Watson & Gershon, Los Angeles, California, for defendant-appellee City of Carson.

Thomas C. Sites, Gallagher & Gallagher, Los Angeles, California, for defendant-appellee City of Compton.

Charles A. Jordan, Holley & Galen, Los Angeles, California, and Richard C. Jacobs, Howard, Rice, Nemerovski, Canady, Falk & Rabkin, San Francisco, California, for defendant-appellee Unocal Corporation.

Walter J. Lipsman (argued), Douglas J. Collodel, and Richard H. Nakamura, Jr., Morris, Polich & Purdy, LLP, Los Angeles, California, for defendants-appellees Carson Harbor Village Mobile Home Park, Richard G. Braley, and Walker Smith, Jr.

Gary E. Yardumian, Kristin E.D. Dunn, and Jack C. Nick, Prindle, Decker & Amaro, Long Beach, California, for defendant-appellee County of Los Angeles.

Robert H. Oakley (argued), United States Department of Justice, Washington, D.C., for amicus curiae The United States of America.

Appeal from the United States District Court for the Central District of California; Kim McLane Wardlaw, District Judge, Presiding. D.C. No. CV-96-03281-KMW.

Before: Schroeder, Chief Judge, and Hug, B. Fletcher, Pregerson, Kozinski, T.G. Nelson, Hawkins, McKeown, Paez, Berzon, and Tallman, Circuit Judges.

Opinion by Judge McKeown; Partial Concurrence and Partial Dissent by Judge B. Fletcher

McKEOWN, Circuit Judge:

1

This appeal stems from the environmental cleanup of a contaminated wetlands site used originally for petroleum production and later as a mobile home park. The current property owner, Carson Harbor Village, Ltd. ("Carson Harbor"), brought suit principally under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. &#167 9601 et seq., for reimbursement of costs associated with the cleanup. We are called upon to determine whether, as a matter of law, those cleanup costs were "necessary" and whether certain of the defendants are "potentially responsible parties" ("PRPs") under CERCLA &#167 107(a), 42 U.S.C. &#167 9607(a).

2

The touchstone for determining the necessity of response costs is whether there is an actual threat to human health or the environment; that necessity is not obviated when a party also has a business reason for the cleanup. Because the district court erred in focusing on the ulterior business motive for remediation and because there are genuine issues of material fact regarding whether Carson Harbor's response costs were, in fact, "necessary," we cannot uphold summary judgment on this ground.

3

Even if we assume that those costs were necessary, we still must decide whether defendants Carson Harbor Village Mobile Home Park, Richard G. Braley, and Walker Smith, Jr. (the "Partnership Defendants") are PRPs; if not, summary judgment was nonetheless appropriate. Parsing the meaning of the term "disposal" in &#167 9607(a)(2) lies at the heart of this question. We conclude that the migration of contaminants on the property does not fall within the statutory definition of "disposal." Thus, on the CERCLA claim, we affirm the district court's grant of summary judgment for the Partnership Defendants.

4

We must also address the remaining issues. We affirm the district court's grant of summary judgment to defendants City of Carson, County of Los Angeles, and City of Compton on Carson Harbor's state claims. Finally, with respect to Carson Harbor's claim for indemnity against the Partnership Defendants, in view of our holding that there are genuine issues of material fact regarding the necessity of Carson Harbor's response costs, we reverse the grant of summary judgment.

BACKGROUND

5

Carson Harbor owns and operates a mobile home park on seventy acres in the City of Carson, California. From 1977 until 1983, prior to Carson Harbor's ownership, defendant Carson Harbor Village Mobile Home Park, a general partnership controlled by defendants Braley and Smith (the "Partnership Defendants"), owned the property. They, like Carson Harbor, operated a mobile home park on the property. Beginning over thirty years earlier, however, from 1945 until 1983, Unocal Corporation held a leasehold interest in the property and used it for petroleum production, operating a number of oil wells, pipelines, above-ground storage tanks, and production facilities.

6

An undeveloped open-flow wetlands area covers approximately seventeen acres of the site. Properties located upstream from the property are in the Cities of Carson and Compton and unincorporated areas within the County of Los Angeles (i.e., the "Government Defendants"). Storm water feeds into the wetlands from those properties through storm drains. California Highway 91 (the Artesia Freeway), which is operated by the California Department of Transportation ("Caltrans"), is also located immediately upstream from the property. Runoff from approximately three miles of the highway drains into the wetlands.

7

While attempting to refinance the property in 1993, Carson Harbor discovered hazardous substances on the site. The prospective lender commissioned an environmental assessment, which revealed tar-like and slag materials in the wetlands area of the property. Subsequent investigation revealed that the materials were a waste or by-product of petroleum production and that they had been on the property for several decades prior to its development as a mobile home park.

8

Much of the tar-like and slag materials was covered with soil and vegetation. A portion of the tar-like material, however, was visible on the surface in an area measuring approximately twenty feet wide by thirty feet long. The slag material appeared to have been deposited on top of the tar-like material and was visible in an area approximately thirty feet by 170 feet. Subsequently, it was determined that the contaminated area covered an area approximately seventy-five feet wide by 170 feet long and extended from one to five feet below the surface. The material and surrounding soils contained elevated levels of petroleum hydrocarbons (measured in "total petroleum hydrocarbons" or "TPH") and lead; and soil samples upgradient of the materials also contained elevated levels of lead. These levels exceeded state reporting limits.

9

As required by law, Carson Harbor's environmental consultants reported their findings to the appropriate agencies. The Regional Water Quality Control Board (the "Water Quality Board") and its Site Cleanup Unit Chief, James Ross, assumed the lead in the cleanup effort. Carson Harbor requested a no-further-action letter from the Water Quality Board before proposing cleanup, and submitted a remedial action plan ("RAP"), proposing to remove the tar-like and slag materials and impacted soils. Because the highest concentrations of TPH and lead contamination were associated with the tar-like and slag materials, the RAP did not address other areas of elevated TPH and lead contamination. Ross approved the RAP but required Carson Harbor to bring the contamination down to a lower level than that proposed in the RAP.

10

The tar-like and slag materials were removed from the property in 1995. Over the course of five days, 1,042 tons of material were removed. In all but four of the soil samples taken after the cleanup, TPH and lead levels were within the state-required limits. The Water Quality Board staff conducted a site visit and independent soil testing. Ross then sent a closure letter to Carson Harbor, stating that

11

the removal is complete to the extent required by this Board . . . . [W]e have concluded that all the requirements established by this Board in our RAP approval letter . . . have been complied with. In addition, the contamination has been successfully removed and the remaining soil in the bottom of the watercourse poses no further threat to surface waters of the State. We, therefore, conclude that no further action is required at this site.

12

In 1997, Carson Harbor brought suit against the Partnership Defendants, the Government Defendants, and Unocal1 seeking relief under federal environmental statutes, CERCLA, the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. &#167 6901 et seq., and the Clean Water Act ("CWA"), 33 U.S.C. &#167 1251 et seq., and for state common law claims of nuisance, trespass, injury to easement, indemnity, and negligent nondisclosure. Carson Harbor sought to recover the costs of its cleanup (which totaled approximately $285,000) as well as damages arising from its inability to refinance the property. According to Carson Harbor, Unocal is responsible for dumping the tar-like and slag materials on the property; the Partnership Defendants are liable as past owners of the property; and the Government Defendants and Caltrans are liable for lead on the property that resulted from lead-contaminated storm water runoff, which may have contributed either to the lead found in the tar-like and slag materials or the elevated lead levels outside those materials.

13

The parties stipulated to the dismissal of the negligent non-disclosure claim and cross-moved for summary judgment on the remaining claims. The district court granted the defendants' motions on all claims except the state-law nuisance and trespass claims asserted against Unocal. See Carson Harbor Vill., Ltd. v. Unocal Corp., 990 F. Supp. 1188, 1199 (C.D. Cal. 1997). The court first held that Carson Harbor's CERCLA claim fails because it did not show that its remedial action was "necessary" under 42 U.S.C. &#167 9607(a)(4)(B) because there was no evidence of an "actual and real threat" to human health or the environment. Id. at 1193-94. In so holding, the district court disregarded certain evidence to the contrary as inadmissible hearsay. See id. at 1193 n.4. In the alternative, with respect to the Partnership Defendants, the district court held that they were not PRPs within the meaning of 42 U.S.C. &#167 9607(a)(2) because "disposal warranting CERCLA liability requires a showing that hazardous substances were affirmatively introduced into the environment. " Id. at 1195. And, with respect to the storm water runoff, there was no direct evidence that any lead-contaminated storm water entered the property at any time prior to 1983, when Carson Harbor purchased the property. Id.

14

The district court granted summary judgment on the RCRA claim because the "evidence shows that there was no imminent danger" to human health or the environment--a required element for a RCRA claim. Id. at 1196 (emphasis added). On the CWA claim, the court concluded that there was no evidence that the defendants violated a National Pollutant Discharge Elimination System ("NPDES") permit, as required for a CWA violation. Id. at 1197. With respect to the common law claims for nuisance, trespass, and injury to easement against the Government Defendants, the district court held that CAL. CIV. CODE &#167 3482, which provides that nothing done pursuant to express statutory authorization can be deemed a nuisance, provides a complete defense. Because Carson Harbor failed to show that the Government Defendants violated the NPDES permits, the court concluded, any pollutants discharged into the storm water were permissible. Id. Finally, the district court rejected Carson Harbor's claim for express indemnity against the Partnership Defendants, because the Water Quality Board did not require the cleanup. See id. at 1198-99.

15

Carson Harbor appealed the district court's rulings on the CERCLA claim, the state-law claims against the Government Defendants, and the indemnity claim against the Partnership Defendants.2 Following the issuance of a panel opinion, we agreed to hear this case en banc.3

DISCUSSION

16

We review de novo the district court's grant of summary judgment. Block v. City of Los Angeles, 253 F.3d 410, 416 (9th Cir. 2001). Similarly, "[t]he district court's interpretation of a statute is a question of law which we review de novo." Pinal Creek Group v. Newmont Mining Corp., 118 F.3d 1298, 1300 (9th Cir. 1997).

I. CERCLA OVERVIEW

17

CERCLA "generally imposes strict liability on owners and operators of facilities at which hazardous substances were disposed." 3550 Stevens Creek Assocs. v. Barclays Bank, 915 F.2d 1355, 1357 (9th Cir. 1990). To achieve that end, CERCLA "authorizes private parties to institute civil actions to recover the costs involved in the cleanup of hazardous wastes from those responsible for their creation." Id.; accord Pinal Creek Group, 118 F.3d at 1300 ("Section 107(a) . . . authorizes suits against certain statutorily defined`responsible parties' to recover costs incurred in cleaning up hazardous waste disposal sites.") (internal quotation marks and citation omitted).

18

To prevail in a private cost recovery action, a plaintiff must establish that (1) the site on which the hazardous substances are contained is a "facility " under CERCLA's definition of that term, Section 101(9), 42 U.S.C. &#167 9601(9); (2) a "release" or "threatened release" of any "hazardous substance" from the facility has occurred, 42 U.S.C. &#167 9607(a)(4); (3) such "release" or "threatened release" has caused the plaintiff to incur response costs that were "necessary" and "consistent with the national contingency plan," 42 U.S.C. &#167 &#167 9607(a)(4) and (a)(4)(B); and (4) the defendant is within one of four classes of persons subject to the liability provisions of Section 107(a).

19

3550 Stevens Creek Assocs., 915 F.2d at 1358 (footnote omitted). The third and fourth of these elements are at issue here.

20

With respect to the fourth element, 42 U.S.C. &#167 9607(a) sets out the "four classes of persons subject to the liability provisions." Id. Those persons are "potentially responsible parties" or "PRPs." See Pritikin v. Dep't of Energy, 254 F.3d 791, 795 (9th Cir. 2001). We must decide in this case whether the Partnership Defendants fit within the second PRP category; namely, whether they owned the contaminated property "at the time of disposal of any hazardous substance." 42 U.S.C. &#167 9607(a)(2).

21

Also relevant to our analysis, although not the basis of the judgment here, is the fact that even if the plaintiff establishes the requisite four elements for recovery, a defendant may assert a variety of defenses to liability. Most relevant here are the so-called "third party" and "innocent landowner" defenses, by which a PRP may show that the release of hazardous substances was caused solely by "an act or omission of a third party," 42 U.S.C. &#167 9607(b)(3), or that "the disposal or placement of the hazardous substance" occurred before the PRP acquired the property. 42 U.S.C. &#167 9601(35)(A). In this way, the interpretation of "disposal" affects the application of these defenses. See infra section III.B.2.b.

22

Once liability is established, the defendant may avoid joint and several liability by establishing that it caused only a divisible portion of the harm--for example, it contributed only a specific part of the hazardous substances that spilled. Even if a defendant cannot do so, it may seek contribution from other PRPs under 42 U.S.C. &#167 9613(f)(1). See Pinal Creek Group, 118 F.3d at 1300 (noting that Congress's amendment of CERCLA to include &#167 9613(f)(1) "clarif[ies ] and confirm[s]" that contribution is available to PRPs). "A PRP's contribution liability will correspond to that party's equitable share of the total liability and will not be joint and several. " Id. at 1301. The contribution provision aims to avoid a variety of scenarios by which a comparatively innocent PRP might be on the hook for the entirety of a large cleanup bill.

23

II. GENUINE ISSUES OF MATERIAL FACT PRECLUDE SUMMARY JUDGMENT ON WHETHER THE RESPONSE COSTS WERE "NECESSARY"

24

Remediation costs are recoverable under CERCLA only if "necessary." It is generally agreed that this standard requires that an actual and real threat to human health or the environment exist before initiating a response action. See, e.g., EPA v. Sequa Corp. (In re Bell Petroleum Serv., Inc.), 3 F.3d 889, 905-06 (5th Cir. 1993); Southfund Partners III v. Sears, Roebuck & Co., 57 F. Supp. 2d 1369, 1378 (N.D. Ga. 1999); Foster v. United States, 922 F. Supp. 642, 652 (D.D.C. 1996); Yellow Freight Sys., Inc. v. ACF Indus., Inc., 909 F. Supp. 1290, 1299 (E.D. Mo. 1995); G.J. Leasing Co. v. Union Elec. Co., 854 F. Supp. 539, 561-62 (S.D. Ill. 1994), aff'd, 54 F.3d 379, 386 (7th Cir. 1995).

25

Although the district court correctly referenced this standard, it went on to follow the "ulterior motive " analysis established by the district court in G.J. Leasing Co., 854 F. Supp. at 562. There, the court held that, to the extent cleanup activities are taken for reasons other than because of "an actual and real public health threat," cleanup costs are not "necessary." Id. Because there was evidence in G.J. Leasing that the cleanup of asbestos contamination was motivated by business reasons (specifically, the desire to convert the property to new uses), the court held that the cleanup costs were not "necessary." Accord Foster, 922 F. Supp. at 652-53; Yellow Freight Sys., 909 F. Supp. at 1299.

26

In concluding that Carson Harbor's response costs were not "necessary," the district court relied on G.J. Leasing's ulterior motive analysis. Specifically, it relied on the testimony of James Ross, the Water Quality Board Site Cleanup Unit Chief. Ross testified that he would "[n]ot likely" have required Carson Harbor to cleanup the site if Carson Harbor had not come to him with a remediation plan:

27

Q: [I]f the owners had not come to you with a remediation plan, if they had simply reported to you that this is what we see here, would you have required them to develop some remediation plan?

28

A: Not likely.

29

Q: As far as you were concerned, this stuff, even the slag and tar-like material, could have just stayed there?

30

A: Very likely.

31

Q: So, then, basically, this remediation was done at their initiative for their own reasons and not because of any environmental or health problem that was perceived by the Regional Board?

32

A: Yes.

33

Carson Harbor, 990 F. Supp. at 1193.

34

The district court's reliance on this testimony highlights its adoption of the G.J. Leasing analysis and its decision to disregard evidence that created a genuine issue of material fact on the linchpin issue of necessity. In determining whether response costs are "necessary," we focus not on whether a party has a business or other motive in cleaning up the property, but on whether there is a threat to human health or the environment and whether the response action is addressed to that threat. It is unrealistic to believe that clean up is necessarily motivated by eleemosynary factors. Although a private plaintiff will almost always have a business or financial motive for cleaning up a site, such subjective intent is simply not part of the calculus. Rather, we focus on the objective circumstances of each case. The issue is not why the landowner decided to undertake the cleanup, but whether it was necessary. See Cadillac Fairview/Cal., Inc. v. Dow Chem. Co., 840 F.2d 691, 695 (9th Cir. 1988) (necessity is a factual question). To hold otherwise would result in a disincentive for cleanup. Indeed, the cleanup may be motivated by many factors, such as fear of a government enforcement action, landowner liability, and even self-serving economic reasons.

35

Nor must a plaintiff show agency action as a prerequisite to cost recovery. Agency inaction is not dispositive of the question whether contamination presents an environmental risk worthy of response. See id. ("[T]he district court erred in ruling that some governmental entity must authorize and initiate a response action for that action to be necessary and consistent with the national contingency plan."); NL Indus., Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir. 1986) (holding that response costs can be "necessary" even though the agency that required cleanup never approved the response actions taken). Whether the Water Quality Board would have ordered remediation is not a definitive determination of whether there is a health or environmental risk.

36

Although agency inaction is not dispositive, an actual agency cleanup order is highly relevant and, in some cases, compelling on the necessity question. Here, there was conflicting evidence on this point. Some evidence in the record also suggests that the Water Quality Board required the remediation and that it perceived a threat to public health or the environment. In his deposition, Ross conceded that lead contamination from the tar and slag material presented a threat to surface and groundwater:

37

Q: Do you agree that this project was a surface water quality protection issue?

38

A: In part, yes.

39

Q: What do you mean "in part"?

40

A: Well, it also has the potential to be groundwater.

41

Q: Okay. So do you think that there might be a threat to groundwater as a result of the contamination on the property?

42

A: Certainly occurred to me.

43

Q: What hazardous substances on the property did you think were a threat to groundwater?

44

A: Lead primarily.

45

Q: Did the levels of lead that were found on this property have the potential to get into the groundwater?

46

A: Yes, the soluble lead.

47

Ross also testified that the level of lead contamination on the property "would require something to be done."

48

A review of the Water Quality Board's conduct also supports the conclusion that it perceived a threat to public health or the environment: The Board withheld the no-further-action letter Carson Harbor's consultant requested shortly after he sent the initial notice of contamination on the property. Instead of adopting the consultant's recommended cleanup levels, the Board required lower lead levels. And, after the cleanup, a Board representative inspected the site to verify that the contamination had been adequately remedied before it issued the no-further-action letter. Finally, the letter predicates closure on a finding that "the remaining soil in the bottom of the watercourse poses no further threat to surface waters of the State."

49

The district court also excluded certain evidence as hearsay, namely, the testimony of Carson Harbor's expert, environmental consultant Dr. Hassan Amini, and a memorandum written by a Unocal employee. In marked contrast to Ross's testimony that in the first instance a remediation would likely not have been required, Amini testified that the Water Quality Board ordered the cleanup, and the memorandum corroborates that testimony, as does correspondence between Amini and Ross.

50

When properly considered, this evidence of Ross's prior inconsistent statements creates a genuine issue of material fact about whether Carson Harbor's response costs were"necessary." This evidence falls within the "basic rule of evidence . . . that prior inconsistent statements may be used to impeach the credibility of a witness." United States v. Hale, 422 U.S. 171, 176 (1975); accord United States v. Bao, 189 F.3d 860, 866 (9th Cir. 1999) ("[B]ecause a declarant's prior inconsistent statement is not offered for its truth, it is not hearsay."). In addition, experts are entitled to rely on hearsay in forming their opinions. See Fed. R. Evid. 703 ("If [the underlying facts or data are] of a type reasonably relied upon by experts in the particular field in forming opinions or inferences upon the subject, the facts or data need not be admissible in evidence in order for the opinion or inference to be admitted."); United States v. McCollum, 732 F.2d 1419, 1422-23 (9th Cir. 1984) (applying Rule 703 to affirm the admission of expert testimony based on hearsay). Thus, the evidence was admissible because it was part of the basis for Amini's expert opinion about whether the contamination posed a threat to public health or the environment such that the Water Quality Board would require cleanup. The district court therefore erred by disregarding this evidence.

51

In light of this conflicting evidence, genuine issues of material fact preclude summary judgment on the issue of whether Carson Harbor's response costs were "necessary. " Therefore, with respect to Unocal and the Government Defendants the district court erred by granting summary judgment in their favor on the CERCLA claim. We discuss the CERCLA claim against the Partnership Defendants, below.

52

We decline to address in the first instance the Government Defendants' remaining CERCLA arguments, including their arguments that they are, nevertheless, entitled to summary judgment because Carson Harbor's response costs were not consistent with the national contingency plan, see 42 U.S.C. &#167 9607(a)(4)(B); because federally permitted releases are exempt from CERCLA coverage under 42 U.S.C. &#167 9607(j); and because the third party defense applies. We leave these issues for the district court's consideration on remand.

53

III. THE CONTAMINANT MIGRATION AT ISSUE HERE IS NOT A DISPOSAL UNDER CERCLA

54

The fourth element of Carson Harbor's cost recovery action requires a showing "that the defendant falls within one of four classes of persons subject to liability under 42 U.S.C. &#167 9607(a)." Kaiser Aluminum & Chem. Corp. v. Catellus Dev. Corp., 976 F.2d 1338, 1340 (9th Cir. 1992); accord 42 U.S.C. &#167 9613(f)(1) ("Any person may seek contribution from any other person who is liable or potentially liable under section 9607(a) . . . ." ). Those four categories of persons are "potentially responsible parties" or "PRPs."

55

To determine whether the Partnership Defendants are PRPs, we must decide whether there was a "disposal" during their ownership of the property. This inquiry rests on our interpretation of the statutory definition of "disposal." Based upon the plain meaning of the statute, we conclude that there was no disposal during the Partnership Defendants' ownership. Therefore, they are not PRPs, and they are not subject to liability. Accordingly, the district court did not err in granting summary judgment in their favor on the CERCLA issue.

56

A. PRPs, THE MEANING OF "DISPOSAL," AND CIRCUIT COURT INTERPRETATIONS

57

Section 9607(a), which sets out the four PRP categories, provides:

58

(1) the owner and operator of a vessel or a facility,

59

(2) any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of,

60

(3) any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility or incineration vessel owned or operated by another party or entity and containing such hazardous substances, and

61

(4) any person who accepts or accepted any hazardous substances for transport to disposal or treatment facilities, incineration vessels or sites selected by such person, from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance, shall be liable . . . .

62

42 U.S.C. &#167 9607(a) (emphasis added). Carson Harbor argues that the Partnership Defendants fit within the second PRP category as owners of the property "at the time of disposal" under &#167 9607(a)(2).

63

CERCLA defines "disposal" for purposes of &#167 9607(a) with reference to the definition of "disposal " in RCRA, see 42 U.S.C. &#167 9601(29), which in turn defines "disposal" as follows:

64

The term "disposal" means the discharge, deposit, injection, dumping, spilling, leaking, or placing of any solid waste or hazardous waste into or on any land or water so that such solid waste or hazardous waste or any constituent thereof may enter the environment or be emitted into the air or discharged into any waters, including ground waters.

65

42 U.S.C. &#167 6903(3) (emphasis added). Under this definition, for the Partnership Defendants to be PRPs, there must have been a "discharge, deposit, injection, dumping, spilling, leaking, or placing" of contaminants on the property during their ownership. Id.

66

Although we have previously concluded that RCRA's definition of "disposal" is "clear," 3550 Stevens Creek Assocs., 915 F.2d at 1362, whether the definition includes passive soil migration is an issue of first impression in this circuit. Other circuit courts have taken a variety of approaches. Those opinions cannot be shoehorned into the dichotomy of a classic circuit split. Rather, a careful reading of their holdings suggests a more nuanced range of views, depending in large part on the factual circumstances of the case. Compare United States v. 150 Acres of Land, 204 F.3d 698, 706 (6th Cir. 2000) (concluding that absent "any evidence that there was human activity involved in whatever movement of hazardous substances occurred on the property," there is no "disposal"), ABB Indus. Sys., Inc. v. Prime Tech., Inc., 120 F.3d 351, 359 (2d Cir. 1997) (holding that prior owners are not liable for the gradual spread of contamination underground), and United States v. CDMG Realty Co., 96 F.3d 706, 722 (3d Cir. 1996) ("[T]he passive spreading of contamination in a landfill does not constitute `disposal' under CERCLA."), with Nurad, Inc. v. William E. Hooper & Sons Co., 966 F.2d 837, 846 (4th Cir. 1992) (holding past owners liable for the "disposal" of hazardous wastes that leaked from an underground storage tank).

67

The first circuit court to face the question was the Fourth Circuit in Nurad. There, the court addressed whether leaking from underground storage tanks is a "disposal. " 966 F.2d at 844-46. The current owner brought suit against two prior owners for reimbursement costs under CERCLA, claiming that the past owners were PRPs under &#167 9607(a)(2). Id. at 840. The court rejected the "active-only" approach, stating:

68

[T]his circuit has already rejected the "strained reading" of disposal which would limit its meaning to "active human conduct." United States v. Waste Ind., Inc., 734 F.2d 159, 164-65 (4th Cir. 1984). In Waste Industries, the court held that Congress intended the 42 U.S.C. &#167 6903(3) definition of disposal "to have a range of meanings," including not only active conduct, but also the reposing of hazardous waste and its subsequent movement through the environment. Id. at 164.

69

Id. at 845. The Fourth Circuit concluded "that &#167 9607(a)(2) imposes liability not only for active involvement in the `dumping' or `placing' of hazardous waste at the facility, but for ownership of the facility at a time that hazardous waste was `spilling' or `leaking.' " Id. at 846; accord Crofton Ventures Ltd. P'ship v. G & H P'ship, 258 F.3d 292, 300 (4th Cir.2001) (holding that, "[g]iven the breadth of the statutory definition of `disposal,' the district court must be able to conclude that the buried drums did not leak " when the defendants owned or operated the facility "to make a finding that [they] were not liable under &#167 9607(a)(2)").

70

Four years later, in CDMG Realty, the Third Circuit addressed whether the spread of contamination within a landfill is a "disposal."

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