Eureka! Judgment Overruled

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The live testimony of the deponents is an admissible form of the evidence that KFD could present at trial. Finally, Eureka objects to certain invoices detailing payments owed by KFD to its environmental consultant. That objection is disposed of in the fuller discussion of that evidence in Part IV. CERCLA provides for recovery of "necessary costs of response" known as response costs from certain potentially responsible parties "PRPs" for releases of hazardous substances.

To establish liability under that provision, a plaintiff must prove that 1 the site at issue is a "facility" as defined in the law; 2 a release or threatened release of hazardous materials from the facility has occurred; and 3 the plaintiff incurred response costs "consistent with the national contingency plan" "NCP" as a result. Ascon Properties, Inc. Mobil Oil Co. CERCLA provides for recovery of response costs from four classes of "PRPs": 1 the current owner and operator of a facility; 2 a past owner or operator of a facility; 3 a person who arranged for disposal, treatment, or transport of a hazardous substance; and 4 any person who accepts hazardous substances for transport to disposal or treatment facilities.

KFD claims that Eureka is liable as a transporter under subsection 4 , as an arranger under subsection 3 , and as an owner or operator of the sewer system also potentially a CERCLA facility under subsection 1. Most of the parties' pleadings focus on Eureka's status as an arranger or transporter. However, the Court finds that there is a genuine issue of material fact as to whether Eureka may be considered an owner or operator.

Consequently, the Court need not decide whether Eureka may be liable as a transporter or arranger to deny summary judgment on this ground. The case most on point is Adobe Lumber, Inc.

Hellman , F. As here, Adobe Lumber involved a dry cleaner that disposed of PCE through a floor drain that connected to a municipal sewer. And, as in this case, owners of the property on which the dry cleaner operated alleged that leaks in the municipal sewer had contributed to the site's contamination. The city in Adobe Lumber argued that 1 CERCLA exempts public sewers from its definition of "facility," and 2 the site had to be construed as a single facility, so the city could not be considered the owner of a separate facility.

The district court rejected both arguments. P'ship v. Suburban Sanitary Comm'n , 66 F. The district court also held that "the primary source for determining the number of relevant facilities is the plaintiff's complaint. Because the site at issue in Adobe could be "reasonably or naturally divided into multiple parts" the sewer and the property above it , the city could be construed as the owner of a separate facility.

The Adobe court held that the plaintiff had made its prima facie case against the city. Though this Court is bound by neither the Fourth Circuit nor the Eastern District of California, it finds the logic followed in those cases persuasive. CERCLA did not exempt publicly owned treatment works, including sewers, from its definition of facility.

A Ninth Circuit case complicates the picture. In Fireman's Fund Insurance Co.

Bellus v. City of Eureka

City of Lodi , the Court of Appeals noted that "it is doubtful whether [the city of] Lodi may be considered a PRP merely as a result of operating its municipal sewer system. However, the only case cited in support of that proposition was another case from the Eastern District of California: Lincoln Properties, Ltd. Higgins , F. Lincoln Properties is not entirely applicable here, because much of the sewer system in that case was owned by the plaintiff, the holder of the private property where the contamination occurred. Finally, the Lincoln court even determined that there was "evidence of releases from County's facilities sufficient to withstand summary judgment.

The Lincoln court's decision to grant summary judgment for the County was not based on a finding that the County was not a PRP, but rather a decision that the County had proved that it was entitled to the "innocent third party defense. That defense requires the defendant to prove 1 that the release was caused solely by a third party; 2 that the defendant exercised due care with respect to the hazardous substance; and 3 that the defendant took precautions against the foreseeable acts or omissions of the third party.

Eureka has not made those showings. The clear weight of authority indicates that the owner of a municipal sewer may be liable under CERCLA for contamination caused by leakage therefrom. There remain genuine issues of material fact as to whether and to what extent Eureka is liable for releases of PCE from its sewer. Eureka Mot. On the issue of damages, "[s]ummary judgment is appropriate where appellants have no expert witnesses or designated documents providing competent evidence from which a jury could fairly estimate damages.

Shell Chem. KFD claims that it has incurred response costs because it paid consultants to investigate environmental contamination on its property.

Eureka makes two arguments in response. First, Eureka objects to the Winzler invoices on the grounds that they are not properly authenticated and are hearsay. Second, Eureka argues that KFD's costs have either been paid or reimbursed by its insurance companies, administrators, or attorneys. An item or document may be authenticated by a witness with knowledge who testifies that the item is what it is claimed to be.

In this case, the sworn declaration of Mr. Daer to whom the invoices are addressed includes the statement that the documents are "invoices I paid to my then consultant, Winzler, relating to costs incurred investigating the environmental contamination. That testimony is sufficient to authenticate the documents.

In response to the hearsay objection, KFD asserts that the invoices are not offered for the truth of the matters asserted therein, such as "specific work conduct or amounts," but for the limited purpose of demonstrating that KFD's costs were not reimbursed by its insurers. However, admitting the documents for that purpose alone may be insufficient to defeat summary judgment.

As McGlinchy indicates, merely demonstrating that some recovery is possible is not enough; a plaintiff must establish a basis for estimating damages. Because KFD has not argued or laid proper foundation for a hearsay exception, the Court cannot consider the documents as though they had been admitted into evidence.

Eureka Williams Corp. v. Kres-kno Oil Burner Mfg. Co., Inc, F.2d (C.C.P.A. ) :: Justia

Nonetheless, a party seeking to avoid summary judgment need not produce evidence in an admissible form, so long as the contents would likely be admissible at trial. In this case, the Court is satisfied that the invoices combined with Mr. Daer's sworn statement provide a basis for estimating damages that would likely be admissible at trial.

The Court finds that there is sufficient evidence for a competent trier of fact to estimate damages and that Eureka is not entitled to summary judgment on this basis. Eureka next argues that any costs KFD incurred are not recoverable because they were paid, or reimbursed, by third parties. KFD replies that some of its costs were not reimbursed, that its insurance liability has not been settled, and that it may be required to reimburse its insurers with any recovery it may secure in this case.

Therefore, KFD claims, it may seek recovery even of costs that were paid or reimbursed by its insurers. The Court finds it unnecessary to rule on the complex issues of insurance payment and reimbursement at this point because KFD has shown that at least some of its costs have not been paid or reimbursed by any third party. KFD has demonstrated that there is a genuine issue of material fact as to whether it incurred recovery costs. Eureka is not entitled to summary judgment on the grounds that KFD has not incurred response costs. KFD argues that Eureka has not incurred any response costs.

In response, Eureka has produced two letters.

The Meaning of a “Debt”

While Eureka is correct that the evidence it has produced in support of its counterclaim is similar to that which KFD produced in support of its initial claim, the law nonetheless bars Eureka's recovery. Research Corp. See id.

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Eurkea's argument is based on the assertion that KFD has failed to obtain public comment concerning the response action. Substantial compliance with the public comment requirement is an essential element in demonstrating consistence with the NCP. See City of Oakland v. Nestle USA, Inc. KFD has produced evidence of its compliance with the public comment requirements.

B; 2 published information on the investigation in the Eureka newspaper, Krasnoff Decl. Nonetheless, Eureka argues that KFD's efforts at compliance are insufficient because KFD has not sought public comment on its proposed remediation plan. Eureka agrees that public comment may be sought only after a remediation plan is chosen. The Ninth Circuit has explicitly rejected that reading of CERCLA: "[T]here is nothing in the plain language of section a that indicates that a party seeking to recover its costs of response must await approval of or action by a state or local government entity.

Indeed, there is no indication in the statute that prior approval or action by a state or local government is either necessary or desirable. Dow Chemical Co. KFD has produced evidence that it has sought public comment on remedial actions it has taken so far, and the parties agree that public comment on proposed plan would be premature.

Those facts are sufficient to establish the existence of a genuine issue of material fact as to whether KFD has substantially complied with the CERCLA public comment requirements. Eureka is not entitled to summary judgment on these grounds. Declaratory Relief and Timing of Review. The Resource Conservation and Recovery Act RCRA authorizes private suits against "any past or present generator, past or present transporter, or past or present owner or operator of a treatment, storage, or disposal facility, who has contributed or who is contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment.

Eureka claims that it did not contribute to the handling, storage, treatment, transportation, or disposal or any hazardous waste. The parties present competing interpretations of what "contribute" means for the purposes of RCRA. Courts in this district have held, following direction from the Seventh Circuit, that "contributed to" means "that some affirmative action is required on the part of the defendant, rather than merely passive conduct.

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Chevron U. KFD has produced evidence that Eureka's sewer was poorly designed and has leaked for decades, that Eureka has known of the leaks since the s, and that Eureka has failed to fix the sewer. See ECF No. A at , Eureka has produced contrary expert evidence to contest those assertions. Whether the design of the sewer, any leakage that occurred, and Eureka's knowledge of that leakage constitute affirmative acts sufficient to render Eureka a contributor to the contamination is an unresolved question of fact. See 42 U. Indeed, in support of its own state law counterclaims in addition to its CERCLA counterclaims, Eureka reminds the Court that a claimant has a "right to pursue multiple, different legal theories, in which to seek its relief.

Allen v. Allen

See Cal. Most importantly, the section that forms the basis of Eureka's claim provides relief only for "[a]ny person who has incurred removal or remedial action costs. The word "incurred" was the key distinction in Atlantic Research , and the Supreme Court left no doubt that "incurred" excludes payments to reimburse the costs of others.

Judgement Day

Eureka has produced evidence only that it might reimburse the RWQCB's costs, and therefore it cannot seek contribution under that section. KFD has brought both public and private nuisance claims and claim for dangerous condition of public property under California law.