## Facts

- A hazardous-waste storage and disposal site on Bluff Road near Columbia, South Carolina received hazardous wastes from numerous off-site generators during the mid-1970s to 1980.
- Site operations involved storing wastes in deteriorating drums, commingling wastes, and poor labeling and compatibility controls; thousands of drums accumulated on-site.
- Significant incidents occurred, including a 1977 toxic release that hospitalized firefighters and a 1979 explosion and fire linked to incompatible chemical reactions.
- Federal and state agencies conducted investigations, undertook emergency and remedial response actions, and incurred response costs.
- The United States and the State of South Carolina sought recovery of response costs under CERCLA § 107(a) from non-settling potentially responsible parties, including site landowners and off-site generators (including Monsanto Company).

## Issues

1. Whether landowners who owned the facility when hazardous substances were deposited are liable under CERCLA § 107(a)(2), and whether the § 107(b)(3) third-party defense applies where the owners leased the property to the operators.
2. Whether off-site generators are liable under CERCLA § 107(a)(3) without proof that their specific waste was present at the time of release, when hazardous substances of the same type were released.
3. Whether joint and several liability is permitted under CERCLA where the harm is indivisible, and what is required to show divisibility and reasonable apportionment.
4. Who bears the burden of proving a reasonable basis for apportionment after the government establishes a prima facie § 107(a) case.
5. Whether a district court may defer equitable allocation among responsible parties to later contribution litigation rather than deciding allocation in the government’s cost-recovery action.
6. Whether imposing CERCLA liability for response costs tied to pre-1980 disposal violates due process or otherwise is unconstitutional.

## Decision

- The Fourth Circuit affirmed summary judgment for the governments on CERCLA liability for the non-settling defendants.
- The court held site owners were liable under § 107(a)(2) because they owned the facility when disposal occurred and did not establish a statutory defense.
- The court held generators were liable under § 107(a)(3) when they arranged for disposal at the site and hazardous substances of the kind they generated were released; the government was not required to trace particular units of waste to the release.
- The court upheld joint and several liability because defendants did not prove the harm was divisible or provide a reasonable basis for apportionment; volume-only allocation was insufficient on this record.
- The court held the district court acted within its discretion by deferring allocation and contribution disputes to later proceedings.
- The court rejected constitutional challenges, concluding CERCLA’s application to past disposal creating present response costs was constitutionally permissible.

## Legal Principles

- CERCLA § 107(a) imposes strict liability on covered persons (including certain owners/operators and arrangers) for government response costs, subject only to limited statutory defenses.
- The § 107(b)(3) third-party defense is unavailable where the defendant has a contractual relationship (including a lease) with the third party and cannot show due care and reasonable precautions against foreseeable acts or omissions.
- For arranger liability, the government may establish the required connection by showing the defendant arranged for disposal at the facility and a release involved hazardous substances of the same type; defendants bear the burden to negate causation in that setting.
- Joint and several liability is permitted where the environmental harm is indivisible; defendants bear the burden to prove divisibility and a reasonable, fact-based basis for apportionment.
- In commingled-waste cases, apportionment generally requires evidence beyond total volume, including information bearing on the wastes’ characteristics and their relationship to the releases and resulting harm.
- A district court may treat the government’s § 107 cost-recovery action as distinct from later contribution litigation among responsible parties and may defer allocation to subsequent contribution actions.

## Conclusion

The Fourth Circuit sustained broad CERCLA cost-recovery liability for both site owners and off-site generators and approved joint and several liability absent a demonstrated basis for divisibility, while permitting equitable allocation to be addressed later through contribution proceedings and upholding CERCLA’s constitutionality as applied to legacy contamination causing present response costs.


United States v. Monsanto Co., 858 F.2d 160 (4th Cir. 1988)