## Facts

- The City of Los Angeles owned Berth 44 in the Port of Los Angeles through its Board of Harbor Commissioners.
- The Board issued revocable permits allowing private entities to operate a boat-repair facility at Berth 44.
- Los Angeles Harbor Marine Corporation held an initial revocable permit for the facility.
- Pacific American Fish Company, Inc. acquired assets of the prior operator and, with City approval, succeeded to the revocable permit.
- Pacific American transferred operational assets to its subsidiary, San Pedro Boat Works, and later assigned the permit to that subsidiary.
- Boat-repair operations allegedly released hazardous substances, contaminating sediments and waters at and near Berth 44.
- The City incurred or anticipated investigation and cleanup costs and sought recovery under CERCLA.
- The City sued, among others, BCI Coca-Cola Bottling Company of Los Angeles as a successor or related entity tied to the facility’s prior operations.
- The City’s owner-liability theory depended on characterizing Pacific American as a CERCLA “owner” based solely on its revocable permit interest.

## Issues

1. Whether holding a revocable permit to use government-owned port property makes the permit-holder an “owner” of a facility under CERCLA § 107(a)(1).
2. Whether successor liability could attach to BCI Coca-Cola on an owner-liability theory if the predecessor’s only asserted ownership interest was a revocable permit.

## Decision

- The Ninth Circuit affirmed summary judgment against the City on its CERCLA owner-liability theory.
- The court held that the revocable permit did not confer sufficient indicia of ownership to make Pacific American an “owner” under CERCLA.
- Because Pacific American was not a CERCLA “owner” on the permit theory, the City could not impose owner-based successor liability on BCI Coca-Cola on that ground.

## Legal Principles

- CERCLA “owner” liability under § 107(a)(1) requires more than a revocable, at-will permission to use property.
- Courts assess “owner” status by reference to property-law concepts, including state-law characterization of the interest and the extent of rights conveyed.
- A revocable permit that does not convey an estate in land and leaves title and core property rights with the public owner is treated as a license-like use privilege, not ownership.
- CERCLA maintains a distinction between “owner” and “operator” liability; a reading of “owner” that captures mere users risks collapsing that distinction.

## Conclusion

The Ninth Circuit held that a revocable permit to use City-owned port property, without additional proprietary rights, does not make the permit-holder a CERCLA “owner,” and it affirmed judgment for defendants where the City’s theory of owner-based successor liability rested solely on that permit interest.


City of Los Angeles v. San Pedro Boat Works, 635 F.3d 440 (9th Cir. 2011)