SteveK February 24th, 2010
On January 19, the District Court in the Northern District of Texas ruled in American International Surplus Lines Insurance Co. v. 7-Eleven that the determination of whether there is an “imminent and substantial endangerment to human health or the environment” sufficient to sustain a private cost recovery claim under the Resource Conservation and Recovery Act (RCRA) is determined at the time the suit is commenced, not after subsequent cleanup efforts.
The case involved a dispute for the cost of cleanup between neighboring gasoline stations. American International Surplus Lines Insurance Co. (AISLIC), the insurer of a former Diamond Shamrock station, conducted a remediation under the direction of the Texas Commission on Environmental Quality (TCEQ). During the course of the investigation, it was determined that some of the contamination had migrated from the adjacent 7-Eleven property. AISLIC commenced an action against 7-Eleven under RCRA for injunctive relief to compel 7-Eleven to remediate the contamination, and for recovery of counsel fees, costs, as well as response costs under the Texas Solid Waste Disposal Act. In response to a motion for summary judgment filed over a year later, 7-Eleven argued that there was no imminent and substantial threat to human health or the environment based upon a report from AISLIC’s consultant prepared after initial work had been undertaken.
The right to bring such an action under RCRA requires that it be demonstrated that 1) the defendant is a “person” as defined by the Act, 2) that the defendant contributed to the handling, storage, treatment, transportation or disposal of any solid or hazardous waste, and 3) that the waste poses an imminent and substantial endangerment to human health or the environment. The third prong was the only issue to be determined. The Court found that the contamination at the Diamond property exceeded the Texas cleanup levels before the suit was filed and that the contamination may continue to migrate from the 7-Eleven property onto the Diamond property. The Court, however, found that there were questions of material fact as to whether the contamination at that time constituted an imminent and substantial threat to humans or the environment at that time, and therefore denied the motion.
DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis & Lehrer, PC ( www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in environmental matters. For additional information about the matters in this bulletin or in the firm’s environmental practice, please contact Steven A. Kunzman, Esq. who heads our Environmental Department.
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