Neither Joint Nor Several: Orphan Shares and Private CERCLA Actions
46 Pages Posted: 25 Jan 2012
Date Written: January 24, 2012
The broad liability scheme of the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) often results in multiple “responsible parties” being liable for the costs of cleaning up a contaminated site. Typically, CERCLA cleanup costs are allocated among the various responsible parties pursuant to equitable factors. Especially because CERCLA liability is retroactive, however, frequently some of those responsible parties are now insolvent, dead or defunct. Who must pay the cleanup costs attributable to the insolvent, dead or defunct parties – i.e., the “orphan shares” – has long been one of most unsettled and critical issues in private CERCLA litigation.
Via a pair of recent decisions, the Supreme Court ushered in a new era in private CERCLA litigation, expanding the availability of private claims under CERCLA § 107 while limiting them under CERCLA § 113. Although this change has raised the specter of jointly and severally liable defendants in private CERCLA actions being forced to bear the entire orphan share burden as a matter of law even where the plaintiff is more culpable, this article posits that this new era affords a fresh opportunity to solve the long-standing orphan share problem. It is time to discard the labels “joint and several” and “several” when describing the scope of liability in private actions under CERCLA §§ 107 and 113. Instead, all private CERCLA claims should be governed by a uniform scope of liability in which orphan shares are allocated among all viable responsible parties, both plaintiffs and defendants, pursuant to equitable factors.
Keywords: CERCLA, orphan shares, joint and several liability
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