Wednesday, September 22, 2010

Celanese Corp. v. Eby Construction Co.

Sep 20: In the U.S. Court of Appeals, Fifth Circuit, Case No. 09-20487. At issue is whether Eby is liable as an "arranger" under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and the Texas Solid Waste Disposal Act (SWDA). The Appeals Court ruled that Eby is not an arranger, and affirmed the district court's final judgment, denying recovery to Celanese. Additionally the Appeals Court affirmed the district court's denial of Celanese's motion to alter that judgment pursuant to Federal Rule of Civil Procedure 59(e).
    In explaining its decision, the Appeals Court says, "The district court found, and Celanese does not dispute, that Eby did not intentionally damage the pipeline. In fact, Eby did not even know that it had struck a pipeline; it only knew that it had struck something with a backhoe. Still, Celanese insists that Eby intentionally took steps to dispose of methanol by disregarding its obligations to investigate the incident and backfilling the excavated area where the incident had occurred. In other words, Celanese argues that Eby's conscious disregard of its duty to investigate is tantamount to intentionally taking steps to dispose of methanol. Burlington [Burlington N. & Santa Fe Ry. Co. v. United States, 129 S. Ct. 1870, 1874 (2009)], however, precludes liability under these circumstances.
    "In Burlington, the Court declined to impose arranger liability for a defendant with more culpable mens rea. The defendant had actually arranged to ship hazardous chemicals under conditions that it knew would result in the spilling of a portion of the hazardous substance by the purchaser or common carrier. See Burlington, 129 S. Ct. at 1880. Given that there was no arranger liability under those circumstances, we fail to see how we can impose such liability here when Eby did not even know that it had struck the Celanese pipeline. Therefore, we hold that Eby is not liable as an arranger under CERCLA."
    Access the complete opinion (click here).

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