Supreme Court Opens Door For New Slew Of Lawsuits Under CERCLA

The United States Supreme Court has just issued an opinion that Potentially Responsible Parties ("PRPs") under the Comprehensive Environmental Response, Compensation & Liability Act ("CERCLA") have a right to pursue cost recovery actions against other PRPs under CERCLA for amounts they have expended for remediation, regardless of whether they themselves have already been sued under the statute. The Court also, by its holding, affirmed the ability of PRPs to pursue the United States for cost recovery in the circumstance where a federal agency is a PRP at the site in question.

In United States v. Atlantic Research Corp., No.06-562 (June 11, 2007), the Court expanded the rights of PRPs-and invited more lawsuits-under CERCLA by ruling that the statute allows a PRP to affirmatively seek to recover voluntarily incurred response costs from other PRPs via independent cost recovery actions. PRPs who have incurred such costs are not limited to seeking contribution from co-defendants under the statute only after having been sued, as was often previously thought and as some courts had held. This ruling clarifies the Court's prior opinion in Cooper Industries, Inc. v. Aviall Services, Inc., 543 U.S. 157 (2004), where the Court held that CERCLA PRPs could only seek contribution under the statute from other PRPs after they were sued, but did not specifically address the question of whether PRPs not yet sued could have a separate, independent cause of action against other PRPs in certain circumstances.

In its unanimous holding, the Court predominantly reasoned that CERCLA's cost recovery and contribution sections were complimentary and provided distinct remedies to different categories of PRPs. PRPs who have been sued under CERCLA can file contribution actions against other PRPs with common liability stemming from the lawsuit, regardless of whether they have actually incurred response costs. However, PRPs who have not yet been sued, but have voluntarily performed site remediation and incurred costs, can proceed to sue other PRPs-including the United States, as was the case in Atlantic Research-under CERCLA's cost recovery provisions.

The high Court's holding in Atlantic Research provides a needed and logical resolution of the issue of the scope of CERCLA PRP's rights against other PRPs in the wake of Aviall. However, while this holding answers a previously open question on the scope of PRPs' rights and provides a positive incentive to PRPs to undertake voluntary cleanups, it also certainly opens the door for a whole new set of lawsuits to be brought under CERCLA against numerous PRPs who previously had been able to avoid CERCLA liability due to the formerly unclear language of the statute.