## Facts

- The United States and Pennsylvania brought a CERCLA enforcement action over PCB contamination at the Paoli Rail Yard Site in Paoli, Pennsylvania (a 28-acre yard and surrounding watershed).
- Rail operations at the yard (service, repair, and storage of rail cars) occurred from 1915 to 1995; PCBs were associated with dielectric fluids used in electric rail car transformers beginning in the 1950s.
- PCBs posed risks to health and the environment and allegedly spread from the yard to nearby properties through releases and erosion.
- American Premier (successor to Penn Central entities) owned and operated the yard from 1915 to 1976.
- In 1976, the yard was conveyed to Conrail and then to Amtrak; Amtrak retained ownership after 1976.
- Conrail operated the yard from April 1976 through 1982; SEPTA operated it from 1983 to January 1995 and phased out PCB-containing dielectric fluid by 1986.
- In 1985, EPA observed unrestricted access to the yard and potential for human exposure.
- The governments negotiated a consent decree with SEPTA, Amtrak, and Conrail resolving their past and future cleanup liability and providing contribution protection for “matters addressed.”
- American Premier, a non-settling potentially responsible party (PRP), objected that the decree’s allocation was substantively unfair and that its contribution protection was impermissibly broad; the district court approved the decree, and American Premier appealed.

## Issues

1. Whether CERCLA authorizes the consent decree’s contribution protection for settling PRPs for the decree’s defined “matters addressed.”
2. Whether the consent decree was substantively fair, reasonable, and consistent with CERCLA’s objectives in allocating cleanup responsibility between settling PRPs and the non-settling PRP.

## Decision

- The Third Circuit affirmed the district court’s approval of the consent decree.
- The court held that CERCLA permits contribution protection for settling parties as to “matters addressed” in a judicially approved settlement.
- The court held the decree was fair, reasonable, and consistent with CERCLA’s objectives despite leaving the non-settling PRP with substantial remaining liability.
- The court upheld the decree’s broad definition of “matters addressed,” given the settlement’s scope and CERCLA’s settlement incentives.

## Legal Principles

- Under CERCLA § 113(f)(2), a party that resolves its liability to the United States or a State in an approved settlement is protected from contribution claims regarding “matters addressed” in the settlement.
- A CERCLA consent decree must be fair, reasonable, and consistent with CERCLA’s purposes; reviewing courts defer to the government’s technical and enforcement judgments within a range of reasonableness.
- “Matters addressed” may be defined broadly when supported by the settlement’s context and the statute’s goals of encouraging settlement and expediting cleanup.
- Substantive fairness permits approximate, non-mathematical allocations using reasonable proxies (including ownership/operation duration and periods of significant contaminant use), and CERCLA tolerates heavier residual burdens on non-settling PRPs as part of its settlement structure.
- Uncertainty about future response costs is common in environmental remediation and does not, by itself, make a consent decree unfair.

## Conclusion

The Third Circuit sustained a CERCLA consent decree for PCB remediation at the Paoli Rail Yard, ruling that broad contribution protection for settling PRPs was statutorily authorized and that an allocation based on ownership/operation history and the period of significant PCB use fell within a reasonable and fair settlement range consistent with CERCLA’s cleanup and settlement policies.


United States v. Se. Pa. Transp. Auth., 235 F.3d 817 (3d Cir. 2000)