An Empirical Analysis of Cost Recovery in Superfund Cases: Implications for Brownfields and Joint and Several Liability

37 Pages Posted: 17 Jul 2010 Last revised: 12 Dec 2014

Howard F. Chang

University of Pennsylvania Law School

Hilary Sigman

Rutgers University - Department of Economics; National Bureau of Economic Research (NBER)

Multiple version iconThere are 3 versions of this paper

Date Written: 2014

Abstract

Economic theory developed in the prior literature indicates that under the joint and several liability imposed by the federal Superfund statute, the government should recover more of its costs of cleaning up contaminated sites than it would under nonjoint liability, and the amount recovered should increase with the number of defendants and with the independence among defendants in trial outcomes. We test these predictions empirically using data on outcomes in federal Superfund cases. Theory also suggests that this increase in the amount recovered may discourage the sale and redevelopment of potentially contaminated sites (or “brownfields”). We find the increase to be substantial, which suggests that this implicit tax on sales may be an important deterrent for parties contemplating brownfields redevelopment.

Keywords: Environmental Law, Torts, Litigation and Settlement, Real Estate, Economics

JEL Classification: K32, K41, Q53, Q58, R38

Suggested Citation

Chang, Howard F. and Sigman, Hilary, An Empirical Analysis of Cost Recovery in Superfund Cases: Implications for Brownfields and Joint and Several Liability (2014). Journal of Empirical Legal Studies, Vol. 11, P. 447, 2014; U of Penn, Inst for Law & Econ Research Paper No. 10-12; U of Penn Law School, Public Law Research Paper No. 10-23. Available at SSRN: https://ssrn.com/abstract=1640680 or http://dx.doi.org/10.2139/ssrn.1640680

Howard F. Chang (Contact Author)

University of Pennsylvania Law School ( email )

3501 Sansom Street
Philadelphia, PA 19104
United States
215-573-8296 (Phone)
215-573-2025 (Fax)

Hilary A. Sigman

Rutgers University - Department of Economics ( email )

75 Hamilton Street
New Brunswick, NJ 08901
United States

HOME PAGE: http://econweb.rutgers.edu/sigman

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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