## Facts

- GE operated capacitor-manufacturing plants that used PCB-based “Pyranol” and generated off-spec material stored in drums labeled “scrap” or “waste.”
- GE accumulated a large stockpile of scrap Pyranol and considered multiple ways to eliminate it, including disposal-oriented options.
- Fred Fletcher operated paint-related businesses and agreed in the mid-1950s to buy GE’s scrap Pyranol for use as a lower-cost paint plasticizer.
- Over about a decade, Fletcher purchased more than 200,000 gallons at low prices; GE later began loading trucks and sending increasing quantities.
- A growing portion of drums delivered to Fletcher was unusable, and there was no indication Fletcher requested the increased volume.
- By the mid-1960s Fletcher stopped paying; after GE’s collection demand, Fletcher complained of declining quality and stated many drums were unusable and that he expected GE’s help.
- GE forgave the outstanding debt tied to unusable material but did not retrieve the drums or assist with their disposition.
- In 1987 EPA found hundreds of drums at the Fletcher site, some leaking; the site was listed under CERCLA and EPA performed response actions.
- A 1994 consent decree required GE to reimburse EPA response costs through April 1993, expressly leaving unresolved liability for later costs.
- In 2006 the United States sued for post-1993 response costs and a declaratory judgment for future costs.

## Issues

1. Whether GE was liable as a CERCLA § 107(a)(3) “arranger” given the requirement that the defendant intended disposal, not merely knew disposal might occur.
2. Whether the government’s post-1993 response-cost claims and request for declaratory relief were time-barred under CERCLA’s statute of limitations.

## Decision

- The First Circuit affirmed the finding that GE was liable as an arranger under CERCLA § 107(a)(3).
- The court held the evidence supported an inference that GE entered or continued the transactions at least in part to dispose of hazardous scrap Pyranol.
- The First Circuit affirmed the district court’s rejection of GE’s statute of limitations defense.
- The court affirmed the award of recoverable post-1993 response costs and a declaratory judgment for future response costs.

## Legal Principles

- CERCLA arranger liability requires proof that the defendant intended to dispose of a hazardous substance; knowledge that disposal will occur, without intent, is insufficient.
- A transaction styled as a sale of a “useful product” can still constitute an arrangement for disposal when the circumstances show a disposal purpose.
- Intent to dispose may be inferred from the totality of the circumstances, including how the material was treated internally as waste, the quality and usability of what was shipped, shipment patterns inconsistent with ordinary market demand, and the seller’s refusal to address unusable material after complaints.
- Under CERCLA, the United States may recover response costs within the applicable limitations period, and courts may enter a declaratory judgment establishing liability for future response costs when liability is shown.

## Conclusion

The First Circuit held that GE’s bargain-priced shipments of PCB-containing scrap Pyranol to Fletcher supported a finding of intent to dispose under CERCLA arranger liability and that the government’s suit for post-1993 response costs and future-cost declaratory relief was timely and properly granted.


United States v. Gen. Elec. Co., 670 F.3d 377 (1st Cir. 2012)